Aviation Sector Crisis Deepens Despite Huge Intervention Funds Given To Private Airlines

By Chinedu Bosah

The aviation sector has been in the doldrums since the outright privatization of the industry. This is an industry that can conveniently be termed an ‘elite industry’ when the average earnings of Nigerians are compared to the high cost of flying from one place to another. And yet the self-serving ruling class is incapable of preserving and developing it.

In 1980’s, the defunct Nigerian Airways alone had about 30 aircraft. At present, there are 5 functional private airlines with just about 20 aircraft servicing the public while the presidency alone has 10 aircraft being maintained most likely with about N10 billion annually. Besides, private jets have astronomically increased from 50 in 2007 to 200 in 2012 which are procured by state governors, big pastors, oil magnets, top bankers, etc. According to Forbes Magazine, these rich Nigerians have spent $6.5 billion in the last 5 years buying jets, and that Nigerians have more jets than the richer African countries like South-Africa and Egypt. For instance, it was reported that Akwa Ibom Governor Godswill Akpabio and Rivers State Governor Rotimi Amaechi. Akpabio spent a whopping sum of $45 million (N7.2 billion) and $45.7 million (N7.3 billion) respectively to buy jets despite the growing poverty amongst the people.

Like every other sector, the aviation industry suffers from lack of adequate facilities and maintenance. For instance, a basic and important facility to any aviation industry like the Aircraft Maintenance Hanger (a project that began in 1975 and later abandoned by the federal government) used in carrying out major repair and maintenance of aircraft has been sold to Arik Air- one of the airlines. Hence, only Arik Air can carry out minimal maintenance on its aircraft while other airlines will have to rely on foreign maintenance outfits that are much more expensive. Lack of facilities and maintenance is largely responsible for some of the runway light blackout recorded in the past, with the most recent happened at Nnamdi Azikiwe International Airport on June 9, 2012, a situation that caused flights to be diverted, cancelled or delayed.

The response of the successive governments to the mismanagement and corruption in the aviation sector and the Nigeria Airways was to privatise Nigeria Airways and create means for these private companies to exploit the people. Nigeria Airways was run aground through corrupt practices and neo-liberal policies that promote private interest at the expense of public interest. And this was made possible because Nigeria Airways like other public corporations was managed undemocratically, which gives room to massive corruption with intention to gratify those in power and their capitalist friends.

However, the doling out public funds to the private airlines as well as the collapse of about 10 airlines in the last few years has shown that privatization is not the solution to the problem of aviation in Nigeria. Indeed, intervention funds have been one avenue with which the ruling elite corruptly enrich themselves. In 2006, a N19.5 billion aviation intervention fund was secured by the then Aviation Minister Babalola Aborisade and the funds was largely looted through the N6.5 aviation Safe Tower Project. In 2009, the federal government through the Central Bank of Nigeria (CBN) distributed intervention funds of N200 billion to the private airlines and most of the funds were mismanaged or diverted. Yet nobody has been arrested let alone prosecuted. For instance, a former director of Air Nigeria, Mr. John Nnorom accused Jimoh Ibrahim, the Chairman and owner of Air Nigeria, of diverting N35 billion aviation intervention funds given to Air Nigeria into buying Banks in Sao Tome and Principe and property in Dubai. Contrary to the argument put forward by the capitalist ruling class in support of doling out public funds to bailout private companies, Air Nigeria as a case study shows clearly that there is no guarantee that public funds invested in the private companies will be well utilized.

Safety is also a major problem in the aviation sector. The Dana Air crash of June 3, 2012 is still fresh in our memory. It is the reason most of the aircraft flying our airspace are branded “air coffin or air molue”. The cause of Dana air crash has been covered up with the claim that the black box was burnt beyond usefulness. Safety will continue to elude the industry since these private airlines exist only to make profit. It is the pursuit of profit and bureaucratic private interest that is responsible for decay in the sector, particularly when it has to do with safety, standard, and efficiency.

Despite the obvious bankruptcy of these private airlines and the mismanagement of all the intervention and bailout funds, it was reported that government is working towards another N80 billion intervention fund to buy 30 aircraft for private airlines. This is government that preaches free market economy as the only way to run economy and turn around to repeatedly gift public resources to private companies, particularly the big ones who are connected to the elements in power. Obviously, private companies and the ruling class in a backward economy like Nigeria is weak and culturally backward to move the economy forward, only the working masses democratically can on sustainable basis build the economy.

Doling out bailout funds and intervention funds to private companies, granting tax holidays and waivers, import monopoly licensing etc., are amongst various means a capitalist government empowers a tiny privileged capitalist ruling elites at the expense of the working masses. In other words, the bailout is committing public resources to guarantee huge profits for private interest. It explains why, the working masses cannot benefit from the so called reforms. In actual fact the masses suffer the dire consequences of these anti-poor interventions. For instance, Central Bank of Nigeria (CBN) and the federal government have invested over N3 trillion to bailout the banking sector while over 30,000 workers have lost their jobs so far and wages systematically dragged down.

Unfortunately, the two unions in the aviation industry are currently so weak to challenge the rot in the sector. This explains why the privatization, mass sack of workers, decay in infrastructure and massive corruption have gone on unhindered. It is only aviation workers and customers/passengers in a nationalized publicly and democratically run aviation, as part of an overall transport plan, that can successfully manage the sector in the interest of all. This is the only way corruption will be significantly reduced and basic facilities put in place to ensure safety, affordable air fare and effective service.