Why Nigerian Airlines Have Been Unable To Compete With Foreign Operators - Keyamo  

Aviation And Government Support

1 month ago
3 mins read

In recognition of the critical role of aviation in national security and economic development, no government leaves aviation issues to market forces entirely. Not even the United States or the European Union. The United States government has supported the Boeing Corporation and European countries have supported Airbus unabashedly.

On October 1, 2011, the World Trade Organization (WTO) ruled that the American government had provided subsidies worth $5.3 billion to Boeing, calling the subsidies illegal. Europe had alleged that Washington had subsidized the large aircraft manufacturer based in Seatle, Washington State, to the tune of $19 billion between 1989 and 2006. The WTO had in 2010 ruled that Airbus, based near Toulouse in the southwestern part of France, had been receiving inappropriate subsidies from European nations.

Against this background, it is strange to read an article by one Ope Banwo bemoaning what he called lamentation by Air Peace over the ongoing price war by foreign airlines to undermine its newly launched operations on the Lagos-London route. Banwo alleged that Air Peace initiated the price war by charging a mere N1.2m for an economy ticket on the lucrative Lagos-London route, as against N3.5m charged by European carriers. Worse, the writer stated the price war serves Nigeria’s biggest air carrier right, even if it meant the airline abandoning the London-Lagos operations. He, therefore, said that the Nigerian government should not come to the aid of our airline.

Banwo is blissfully ignorant of the aviation industry and the role of the government in supporting its strategic interests. What could be of more interest to the Nigerian government that Air Peace can slash fares of international travel by over 50% at a time of unprecedented economic hardship?

In business terms, the drastic reduction in fares would automatically translate to a considerable reduction in business costs. London is not just the capital of Nigeria’s erstwhile colonial master, but also the world business capital, as Tunde MacAlabi, the chief executive of the Africa International Investment and Trade Fair and Exhibition, noted recently in a statement endorsing Air Peace’s patriotic intervention on the Lagos-London route.

MacAlabi, for those who may not know, was deeply involved in the development of Murtala Muhammed Terminal Two in Ikeja, Lagos, under the ebullient leadership of Dr Wale Babalakin, a Senior Advocate of Nigeria (SAN). MacAlabi marketed Nigeria very well at the 78th United Nations General Assembly (UNGA) sidelines last September. Among participants in the AIITFE last year were the Minister of Aviation and Aerospace Development, Mr Festus Keyamo; the Minister of Industry, Trade and Investment, Dr Doris Uzoka-Anite; and the Minister of State for the Federal Capital Territory, Dr Mariya Mahmud.

READ ALSO: Why Nigerian Airlines Have Been Unable To Compete With Foreign Operators – Keyamo  

Banwo wishes Air Peace to go the way of Bellview, Arik, and Medview. What manner of man is happy to see that international aviation operations of his country are purely by alien airlines?

While the N1.2 million charged by Air Peace is cost-reflective and informed by patriotism, the far-below-market fares now charged by British Airways, Qatar Airlines, and Ethiopian Airlines, among others, are done in bad faith. These air carriers are portraying themselves as exploitative and unconscionable. For if they should succeed in chasing Air Peace out of the London-Lagos operations, as they did to other Nigerian airliners, they would quickly revert to the old exploitative rates of charging N4 million for a one-way ticket to London in the economy class.

It is axiomatic that Banwo has no clue how patriotism drives governments in countries famous for subscribing to the primacy of market forces. Amidst the Great Recession of 2008, the new President Barack Obama administration decided to rescue the three iconic American motor companies, namely, Ford Motors, General Motors, and Chrysler Motors, though Ford later opted out of the package because its situation was not as grave as its two peers.

The package worked wonders. Hence, when Obama was campaigning for reelection in 2012, his campaign message was simple: “GM is alive, Osama bin Ladin is dead”. GM represented the wisdom of his economic management style and bin Ladin’s death was the triumph of his foreign policy. The message resonated with the Americans, and he was reelected resoundingly.

Just on Monday, April 15, 2024, the Joe Biden administration announced the provision of a whopping $6.4 billion to Samsung Electronics of South Korea to develop a chip manufacturing and research centre in Texas! This is the extent Washington has gone to support even a foreign firm so long as it produces and researches in the United States. And someone has the guy to argue in a public forum without any sense of embarrassment that the Nigerian government should not support our own airline in the highly competitive aviation market.

The problem with pen pushers like Banwo is not just crass ignorance of the dynamism and flexibility of global developments, but a profound lack of self-esteem. No self-respecting person can pen an article like his own advertising ignorance. A person without self-esteem cannot have patriotism.

Even if Banwo is a hired gun, he should exhibit a bit of intelligence and maturity. British Airways, Virgin Atlantic, and other foreign airlines operating in Nigeria should search for agents who could do a fairly decent job. The article by Banwo against Air Peace while extolling foreign interests could not have been lower.

 

Animashun wrote from London.

Remi Animashaun

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