Stella Oduah…time to use the stick

The history of aviation in Nigeria cannot be described as most enviable, we have certainly had our ups and downs. I am impressed with Stella Oduah’s effort in trying to have stronger airlines that are not saddled with capital adequacy issues but when it comes to the way to achieve this , I think differently. So far, she has extended the olive branch to the Airlines to self regulate and create mergers that are not imposed on them by law. So far, the airlines have refused her gesture of goodwill. And so what should be done next?

When it comes to Airlines, certainly the bigger you are, the better positioned you are to manage the fleet of aircraft transversing the air space. All human lives are priceless and we cannot afford another air disaster. If we accept the fact that the Airline business is capital intensive with very little profit margin, then it is easily agreeable that the business is not an all comer one, especially for those who are motivated by short term profits. Scheduled Aircraft Maintenance are necessary to keep these big birds flying and safe. With vehicles, you can miss a scheduled preventive maintenance here and there, the risk you have is that of the complete break down of the vehicle. Since this is on the ground, costly repairs can resuscitate the vehicle. This is not the case with Aircrafts. You need to maintain them before they break, any failure will result in a catastrophic event- the big bird will simply fall down from the air and entomb in itself the people therein. By then, it is too late to repair.

So what do I advice Stella to do?
This is where leadership makes all the difference. It is true that she cannot coerce them to merge, I have not seen such powers granted to the minister or made to form part of the Companies and Allied Matters Act. However, using the various approval powers in her kitty, she can stipulate the minimum capital requirements for operators in the industry. I would add that she can make provisions as to the minimum number of aircrafts and ages that an operator should have to be allowed to fly within the Nigerian Airspace. She can add to this the number of pilots and their flying hours. Simply put, Stella has used the carrot and the airline operators are not responding, it is time to use the stick.

Up till 2005, there were only two (2) Airlines operating in the Republic of Korea – Korean Air and Asiana Airlines. They were efficient, highly capitalised and met the flying needs of the Korean Republic. With a growing needs from 2005 till date, an additional five (5) airlines to fly the air space. In Nigeria, we do not need many airlines. We need airlines that are efficient, can maintain the aircrafts and pay competitive salaries to their employees. Demand is not an issue, the problem is with the quality and not quantity of supply. When it comes to airlines, we need quality and not quantity.

Stella, please do the needful – revisit the qualification criteria for operating an airline in Nigeria and I promise you all the airlines will force themselves into mergers and Nigerians will be better for it. If you don’t believe me, call Sanusi and he will share with you the CBN experience concerning our under capitalised banks. Today, these banks are performing wonders and some of them are now rated high amongst other banks in the world.

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