An Aviation Expert and Managing Director of Katari System Nigeria Limited, Ali Mohammed Magashi, has identified very high interest rate charged by airlines by commercial banks in the country as one of the several funding obstacles militating against the growth of the industry.
He also mentioned poor credit rating as one of the major obstacles.
Katari made the identification while presenting a paper titled,”Financing Nigerian Aviation: The Option For Growth” at the Nigeria Travel Mart(NTM)1st Anniversary Colloquium with the theme, “Leapfrogging Nigerian Aviation To Match Her Potential” on Tuesday, December 8,2015.
Speaking further Katari listed other funding obstacles to the growth of Nigerian aviation to include; over regulated financial system, which according to him impedes on simple and genuine foreign currency transaction, over regulation and expensive procedures by the Nigerian Civil Aviation Authority (NCAA),which he said impede on start-up airlines.
Poor and hostile business characterized by our position in the “easy “to doing business in Nigeria ,he lamented has not help matters, adding that for the Nigerian aviation industry to grow the Federal Government must provide conducive climate for investors to invest.
He also alleged that the exploitation by NCAA using multiple inspections of aircraft, training facilities and maintenance facilities equally impede aviation growth.
On financing model for Nigerian aviation , the managing Director of Katari System Limited ,stated that there should be targeted and effective subsidy from the Federal Government ,intervention guarantee funds with very low interest rate with longer tenure ,reduction of multiple taxation that impedes airlines revenue ,create easier access to foreign exchange from the Apex bank ;Central Bank of Nigeria(CBN)
Other solutions proffered as funding models for the country are: reduced Customs and Excise tariffs for local airlines, reduction of landing ,parking ,navigational charges for local airlines , lighting up airports and keeping maintaining them, as only very few airports operates 24 hours ,while other operates only visual flights.
On why the Federal Government initiatives did not achieve the desired results, he pointed out the Bank of Industry (BOI) initiative fund that was put forward did benefit airlines but the banks because there was poor monitoring of the process.
Speaking further, he cited a situation where aviation agencies which includes NCAA, the Federal Airports Authority of Nigeria (FAAN),the Nigerian Airspace Management Agency(NCAA) Nigeria Meteorological Agency(NIMET)and the Accident Investigation Bureau(AIB) are working as silos .
Katari appealed to stakeholders and participants at the gathering to work together if the Nigerian aviation must achieve any meaningful growth, adding that the aviation industry has become one of the pillars of micro economy of the Nigerian economy.
Earlier , the Publisher of and the Chief Executive Officer, Nigeria travelsmart.com and organiser of the colloquium, Mr Simon Tumba, lamented that the inability of Nigeria with harness the huge population the country has .
He posited that other countries such as the united, India maximise their huge population to the benefit of their respective aviation industries, wondering why Nigeria has not been able to do so.
Tumba called on stakeholders and participants at the colloquium to look into how Nigeria can tap into the huge population to contribute to the growth of aviation.
According to him, “Why is it that despite her population Nigeria has failed to harness it huge population. What is preventing Nigeria from miximise her population? He asked
To buttress his point, he cited the Population Reference Bureau statistics that projected that by 2050 Nigeria’s population would rise to 396 million and which would automatically make the third largest in the world in terms of population.
Tumba stated that with this population Nigeria could boast a very big market, which airlines over the world would want to operate
“Today, Nigeria is the world’s 7th largest in population. Guess what in 2050, Nigeria will be the third largest populated nation on earth. It’s a challenge and opportunity. Amongst the projected top 10 in the data is Ethiopia with a figure of 165 million in 2050. Surely we all know that Ethiopia is already pouncing and set for the dominance of Africa by then. What about Nigeria?” he asked