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Nuhu: Nigerian carriers shortchange themselves in pact with foreigner airlines

 

 

Capt. Musa Nuhu has a very rich experience in global aviation and was recently appointed the Director-General of Nigerian Civil Aviation Authority. In this interview with WOLE SHADARE, the cerebral airline pilot, safety expert, quality assurance lead auditor and an artificial intelligence expert speaks on restrategising to reposition the country’s aviation sector, economic regulation of airlines for profit and survival. Excerpts

 

 

How was your experience as Nigeria’s Permanent Representative to the International Civil Aviation Organisation (ICAO), and ICAO’s President, Dr. Olumuyiwa Aliu’s influence on you?

 

It was a rare privilege to be nominated and to serve on the ICAO council as Nigerian representative for about three and a half years from 2016 to end of last year. It was an amazing experience. I don’t know how I can explain it. ICAO council, which is the governing council, consists of 36 member states, which are elected every two years.

 

Nigeria has been on that council non-stop since 2016. Members come from different background. Some have been ministers in their countries, retired generals, career ambassador and DGs and you have people like me who are technocrat from the industry.

 

Generally, Nigeria has always been represented by people from NCAA. You got to meet and discuss with people from corners of the world and you see for the same problem, everybody has his own solution and ideas; we had our disagreement and agreed on issues. On the council we have eight members from Africa. We have the Afrigroup where we sit down to strategise to protect and promote the interest of the Africa continent. Before I left I was the coordinator of that group.

 

We were able to achieve a lot for the benefit of Africa. Dr. Aliu was the representative of Nigeria for about eight years from where he was elected president of ICAO. He was also a director in NCAA when he was sent to represent Nigeria in the council of ICAO. I was blessed to have something like that having got into the council will little knowledge of the working of the council.

 

Once in a while when I have issue I went to him and he will refer me to document to go look at. He had a good influence on me and I appreciate it and I was lucky to have a Nigerian as the president of a global organisation like ICAO. it is not easy.

 

Also at the other end, everybody expecting me to perform like Dr Aliu. You find people like him once in a lifetime, there is no way I can fill his shoes, they are too big for me.

 

Just recently, NCAA carried out a restructuring of its directorate. Consumer Protection Directorate seems to have been scrapped. Is that a plus or a minus?

 

I think there is a misunderstanding. Consumer protection has not been scrapped. It was just downgraded from a full directorate to a unit under the directorate of air transport regulation, which is what it used to be. Consumer protection exists in full with all the functions it has.

 

We still have consumer protection; it has never been scrapped. If you go to the airport you will still see the staff from the unit carrying out their job without any reduction in their scope.

 

How do you think Nigerian airlines can cope in the face of COVID-19 that has made life difficult for them? What is the economic health of these airlines?

 

The issue is not limited to Nigerian airlines. It is a global thing. In the airline industry, the profit margin is very minimal, if you make five per cent profit margin in the business, you are considered to have done excellently well, but, however, with the COVID-19 and the difficulties, airlines financial positions are not the best.

 

It is a global phenomenon and there are so many other issues that affects the financial health of airlines that is neither in the control of the Ministry of Aviation nor in the control of the civil aviation regulatory body.

 

For instance, the provision of foreign exchange, it doesn’t come from us. If a country’s foreign earning goes down, the central bank prioritises, and you can understand due to the lack of maintenance organisations in Nigeria, pilot recurrent training institutions in Nigeria they have to go outside to do these and that entails a lot of foreign currencies. So, it is not easy.

 

Also is Jet A1 that is a major factor that airlines have been having difficulties with. Sometime we see it induced scarcity and escalatory price, so there are factors that affect the health of the airlines that are not in our direct control.

 

The ministry has tried; it went to the central bank when this government came on board. Nigeria owed foreign airlines about $600 million dollars in arrears but the minister, through consultations, was able to get that off our back and all the foreign airlines were paid.

 

We visited NNPC to see what kind of arrangement can be made for the production of Jet A1 and in addition, interest rate, when airlines go borrowing at a very high interest rate, which we know is very high in Nigeria. If my profit margin is five per cent, explain to me if l take a loan at 20 per cent, how can I break even and pay them and make profit?

 

These are the micro and macro factors that affect the health of the airlines. We try through our economic regulations to do the financial audits of the airlines and advise them where we see areas of economic difficulties and see how they can be tackled.

 

One of the things we are doing we want to really strengthen the function of the economic regulation through more training of the staff of the directorate. As you are aware, we are having some restructuring going on, it is to reposition the regulatory body to able to carry out its responsibilities in a more effective and efficient manner.

 

There are documented evidences of how Nigerian airlines have been badly treated by foreign counterparts. How do we ensure a level playing field?

 

The advice I will give the airlines is that if you are going to another country to negotiate you services, you should involve the regulatory body, the Ministry of Aviation and also your embassy in that country. If you as a private organisation you go and negotiate with a government entity that is trying to protect its own airlines, you are going to run into difficulties.

 

When you involve the Ministry of Aviation officials, the Nigerian Civil Aviation Authority (NCAA) and embassy officials; the country knows that if they make things difficult for our airlines, we will apply the same reciprocity measures to their airlines, so it make a big difference. A lot of airlines go and do the deal themselves.

 

They should involve us, carry us along, brief us; we are here to help our airlines grow both domestically, regionally and internationally. I hear them talking about aeropolitics.

 

Yes, an airline from Nigeria want to go compete with an airline of another country on their route, of course they will try and make it difficult for you, but when you carry NCAA officials along, it makes a difference, if you make unreasonable demands on my airlines, I will apply the same to your airlines coming into my country, so it is to their benefits for everyone to come out with good terms for all the airlines.

 

The advice I will give the airlines is that if you are going to another country to negotiate your services, you should involve the regulatory body, the Ministry of Aviation and also your embassy in that country. If you as a private organisation you go and negotiate with a government entity that is trying to protect its own airlines, you are going to run into difficulties.

 

They should involve us, carry us along, brief      us, we are here to help our airlines grow both domestically, regionally and internationally. I hear them talking about aeropolitics, yes, an airline from Nigeria want to go compete with an airline of another country on their route, of course they will it difficult for you but when carry NCAA officials along, it makes a difference.

 

What is the effect of COVID-19 on the aviation industry and what are the rescue plans?

 

The meeting I had after my hand over from the acting DG, the discussion I had was on COVID-19, by then it was not yet declared a pandemic, but we could see the trend coming, so had started putting measures in place, firstly, how we are going to run the NCAA as an organisation and business continuity plans in place, how our staff will be working with the development to ensure that whatever happen, we will have people that will be running the organisation regardless of the COVID challenge, we ensure we have somebody who will step in, we prepared to reduce the workforce coming, a lot of them will stay at home and we have what we determine is enough that will run the organization.

 

Basically at that time, it was the issue of survival, whatever plans has to be put in place, because whatever plans you have, if you don’t survive, your plan are of no use.

 

First of all, we have to survive, ensure the organisation survives, and to put measures for the industry to survive. It certainly delayed our plans but now with the successful resumption of domestic flight and we have not had a significant spike and contamination cases, so all the plans have been delayed but we have successfully resumed the domestic operations, perhaps one or two minor hitches there, nothing significant, and I know you will all agree with me so far so good and the response from the public complying with the protocols have been excellent.

 

We started the international flight operations, with time we are going to increase the number of flight coming in as things stabilizes, we identified hitches that were rectified and we hope things will get much better going forward.

 

So, part of the plans we had is repositioning the regulatory body to be more resilient and a body that is flexible to react to changing situation and part of the restructuring we have had is part of this process and in the coming months, we will see the organisation in a good position to deal with challenges and the emerging challenges.

 

As you are aware, COVID-19 has changed the global industry, the rapid changes in technology are also changing the industry, not only aviation but also the ways businesses are conducted. So, we have to reposition ourselves to fit into that so that we can really effectively conduct our regulatory responsibilities.

 

What strategy do you advice airline to adopt on how to best run the business?

 

Each airline has its own business model. So running an airline has a number of issue that can impact the running of the airline and one of these is corporate governance, separation of ownership from the day to day management of the airline business. For a lot of airlines in Nigeria, that is a very blood line because there is no definite guidelines separating the owners of the airline from its management.

 

Over the years it has contributed to the difficulties and challenges a lot of airlines have. Once the civil aviation act is passed by the National Assembly and we have a new mandate, we intend to look at that regulations also maybe with the Cooperate Affairs Commission we will sit down and see how we can apply some of these corporate governance issues in our regulations strictly and resolve some of these difficulties we have been facing and one of the things we are going to do is that the directorate of air transport regulations will be empowered and also enhance their skills and knowledge to really study the business models and plans of airlines and see how effective they can be and we can have a more positive regulatory function, we are doing it now but I believe we need to build more capacity in that department.

 

 

 

 

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