Says govt is killing airlines

Ide Ihiala and Chairman of Air Peace Airline, Chief Allen Onyema, in this interview assesses President Muhammadu Buhari after month in office and awards him high marks. He also speaks on the war against insurgency, the hurdles of operating an airline in the country, his opposition to plans to float a national carrier and why government must not give intervention fund to airlines that received such fund in the past and mismanaged it.

By Clifford Ndujihe

What is your assessment of President Muhammadu Buhari, one month after he assumed office?

One month of President Buhari, I will say is highly successful. The president should not be stampeded into taking hasty actions that we may regret at the end. He needs time to plan. He met things that are not so pleasant on his table. He has to take time to undo some of those wrongs.

In one month, you don’t expect anybody to perform miracles.

One thing he did that I like is on the election of the National Assembly leadership. The president told the whole world weeks before the election that he was not going to interfere.

And the president, who everybody did not know to have democratic credentials, all of a sudden said he was not going to meddle in the issues of the National Assembly leadership and stayed away.

When members of the National Assembly elected their leaders, the president said, ‘I would like to work with my party’s choice but the people in the parliament have made their choice. I will stand by them because the choice is constitutional.’

Constitutional choice

By so doing, the president has shown that he has removed his military garb and is ready to follow things the way they should be followed.

Again, one thing you must give to Buhari is his aura. The aura of an incorruptible mantra is already affecting the entire country and people are scared to do the wrong things. With that alone, I score him 100 per cent.

His assessment of Buhari on fighting insecurity

He just took over one month ago. He needs to study the security reports that the past government collected in the last four years. You cannot really judge him now, he has to plan. It is when he hits the road running that you can actually judge him. You cannot really expect him to throw the Nigeria military into the fray like that. He has done the first thing by visiting leaders of the neighbouring countries to solicit their support.

Being a former military leader, I am sure he wants to move against Boko Haram in a very bad way. So he would not want a situation where when he moves against them they would find succour in the neighbouring countries.

I believe he will deal with the issue but they should not forget those affected by the insurgency because if you are attacking insurgency and not doing anything about those who suffer collateral damage as a result of the insurgency you will be creating more Boko Haram at the end of the day.

On what to do with the National Conference report

Nigeria is a country of about 378 ethnic nationalities. If these nationalities-Hausa, Yoruba, Igbo, Ijaw, Nupe, Fulai, Gwari, Urhobo, Efik, Itsekiri, etc got together and agreed I think government should adopt the report, that will be the beginning of cementing the unity of this country.

On Buhari’s comment that Jonathan’s administration was worse than Shagari in terms of corruption

Just like I will not assess this regime unfairly before you start assessing the government of Jonathan, you must look at the conditions under which he operated. In assessing who is worse we should consider the circumstances under which they operated. From the day he was announced as the winner of the election till the day he handed over, Jonathan operated with serious security challenges. With that kind of situation it may be difficult for anyone to operate but that is not to excuse the excesses of his government

Jonathan must have got certain things right. Chief among them is the peace we are enjoying now because this country was waiting to explode but Jonathan said, ‘no, I concede defeat.’

That has never happened before. So, whatever sin he must have committed he wiped it off with that singular act because Nigeria would have been boiling by now. So we should not do anything that will truncate the peace. We should mind our utterances towards one another and guard jealously the peace we are enjoying.

Since October 24, 2014, Air Peace has been in operation. What has the experience being like?

Wonderful! Wonderful in the sense that the challenges are interesting but when you take the positive sides what Air Peace achieved in its first six months is monumental.

It is like we have been there for 10 years. We are barely seven months old but we have changed the face of aviation in this country. I am talking about scheduled flight operations and the way it is run in this country. We have energized competition and brought some innovations that others are emulating and the older airlines are trying to straighten their acts.

What are the challenges?

There are so many challenges out there. If you placed one-tenth of the hurdles airline operators face to stay afloat in Nigeria before airlines in Europe, America, British Isles, etc, the foreign airlines will collapse within 48 hours.

First of all, there is no enabling environment to operate. Government policies are not friendly to investments. There are multiple taxes from government agencies. The Nigeria Civil Aviation Authority, NCAA, takes 5 per cent of your total collections. The question is do you make up to five per cent profit?  In a year, no airline makes up to five per cent profit. So where does the five per cent come from? It means your capital is being further depleted.

Airlines have been complaining for a long time but nothing has been done. When people criticize Nigerian airlines, they don’t mention this. The NCAA, Federal Airport Authority of Nigeria, FAAN; Nigeria Airspace Management Agency, NAMA take their fees upfront. FAAN takes about N2000 per passenger.

Government policies

Chief among the hurdles are government policies. Government says it has waived import duties but in actual fact did they waive import duties? You bring in your aircraft they come with other headings to take money out of your purse. It is only in this country that government acts as disincentive to investments yet the same government will be talking about creating employment.

The Civil service will want to kill you before you even start. As a Nigerian airline, you are dead on arrival because of these hurdles.

Apart from multiple taxes, the running cost is prohibitive. What about insurance? Out there, they use peanuts to insure their planes. In Nigeria, the regulatory body, NAICON says you must insure through a Nigeria company but 10 to 20 Nigerian insurance companies put together cannot insure one aircraft adequately. It means that we have to go abroad to get underwriters who will now use all manner of conditions to extort much money from you. Whether you fly your aircraft or not, the insurance premiums are static and you must pay prohibitive insurance premiums.

Before I started operations, I paid over $1.6 million to underwriters.

The agencies are not helping too. I want to own a maintenance hanger. They did not give me land until I made so much noise. As at the time they were giving me land, they asked me to pay N675million for 15 years. Why should a government agency be an outright disincentive to investment?

How can government create conducive environment?

Government should start thinking of privatization. Government must remove multiple taxes, which is a hindrance to the development of the industry. It is even a hindrance to actualizing safety. Government must also look at the issues of easy accessibility to foreign exchange and creating an avenue for airline operators to collect cheap funds from the banks.