By Ade Segun

The cream of the aviation industry gathered on Wednesday, 2nd  September, 2015 to discuss the future of the industry at the GRA, Ikeja Golf View Suites. In a Breakfast Meeting chaired by the Arik Air Chairman, Arumemi Johnson, industry leaders x-rayed extensively the perennial challenges of Ownership, Funding and Sustainability of Nigeria Airlines.

Aviation

The meet, organized by the Aviation Round Table (ART) featured Professor Anthony Kila of Cambridge University, Bismark Rewane of Financial Derivatives and Stephane Timpano of Brain & Company In his Presentation, Professor Kila gave an in-depth analysis of transition of airlines from one-man private initiative before World War II to state ownership post-World War and finally to the new trends of state/private ownership and full private equity held on the Stock.

In his conclusion, he was of the view that government’s involvement in airlines has to do with what objectives it wants the airline to achieve. Such objectives in most cases, Professor Kila said, include, but not limited to driving development in tourism, airport hubs, Maintenance, Repairs and Overhaul (MROs) and manpower development.

Bismark Rewane who was in his professional elements, gave a detailed analysis of the financial locale in which domestic airlines now operate. He argued that the same harsh conditions will also affect any new carrier floated by the government and that therefore, there is need to address the challenges.

Rewane, Kila and Timpano concluded that whatever government intends to do with the National Carrier and domestic airlines, it should ensure a level playing field and must depart from the past in which it controlled and ran its National Carrier as that would lead to failure.

The other speakers, Capt Meggison Noggie, Chairman, Airline Operators of Nigeria (AON) and Capt Mohammed Joji blamed the Ministry of Aviation for the challenges facing the airlines.    They accused the Ministry of bastardizing BASA and entry points to foreign airlines to the disadvantage of domestic airlines.    Joji was  of the view that government should not invest money in a National Carrier; rather the airline should source funds from the Capital Market.

However, the strongest salvo came from the Arik Chairman, Arumemi Johnson, who had no affectionate word for officials in government.    A visibly disturbed Arumemi, complained bitterly of his experience in the hands of the Ministry during the tenure of Stella Oduah and the continuing nuisance of aviation Parastatals who he accused of misinforming the President and the public of Arik’s indebtedness.

He went into extensive explanation of how he brought his son as Group Managing Director, saying it was at the behest of Exim bank that financed his aircraft acquisition.    Arumemi lampooned those who criticize Arik as weak in the media, calling them ignorant.    He further showed his detest for a national carrier that will be set up to compete with Arik and the rest domestic carriers.

For him, a national carrier should be limited to the role of manpower and MRO development.    He chastised the Presidency for poaching pilots he trained and wondered why NCAA would not stop pilots he trained from leaving Arik for greener pastures.

In conclusion, Arumemi called for a forensic audit of the Ministry of Aviation and its Parastatals whose officials he accused of corruption.    He told the forum that he never went to AMCON to borrow funds and blamed Union Bank for his plight.

He wondered why anybody should ever suggest the take-over of Arik on account of AMCON debt which was insignificant when compared to the value of the airline’s assets.    He announced that he has engaged Goldman and Sach and Vetiva to prepare Arik to go public by mid-2016 at which time he would have paid off AMCON.

He further revealed that he had placed order for 26 next generation Boeing model aircraft and that by 2021, Arik would have a total of 46 aircraft. The well-attended Breakfast did not make room for comments from participants but outside the conference hall, participants engaged freely on the issues discussed.

Reacting to Arik Chairman’s call for a forensic audit of the aviation sector, a FAAN official who did not want any mention of his name said that it is laughable to cry over facts like a stranded baby and asked that Arik should first submit itself to a forensic audit over how much it paid for Nigeria Airways Headquarters and Hangar worth over N5billlion and how it financed his start-up.

Another participant said he has sympathy for Arik but that he was becoming too emotional in his public discourse. “I believe he is doing what every investor will do to protect his investment. But I doubt if it is in national interest”.

In his reaction, Aviation Consultant, Chris Aligbe said “he was tired of engaging operators who are not ready to accept that they are not in any position to meet the challenges of capital flight worth over US$2.7billion on ticket sales alone as at 2014, creating employment for over 400 young pilots and engineers, development of Lagos, Abuja and Kano as primary, secondary and regional hubs respectively.

I would want any domestic operator opposed to a national carrier to give Nigerians cogent reasons why not.

Incidentally, I am aware that it is only Arik and AON Chairman, Capt Meggison that are opposed to the idea in the industry while Bankole of Med-View Airline, who has close to 40 years in airline operations is fully in support.

I just think that those opposed to it are self-regarding and are merely advancing a “dog-in-the-manger” argument that bothers on primitive egoism”,    Aligbe said.    Aligbe dismissed the argument that the government would waste vitally needed resources on a venture that will fail as self-serving blackmail since the envisaged airline will come on zero funding from government and government sweat-equity.

An ART member said a national carrier has become long overdue but that government should help Arik and Med-View to become very strong flag carriers whether they go public or not.