As aviation stakeholders make a case for the promulgation of a Fly Nigeria Act, Nkem osuagwu takes a look at what it means for the industry and posits that indigenous airlines have to work towards upgrading their service offerings to be able to benefit from such an Act.
Concerned with the limited growth of Nigerian registered airlines, industry watchers recently made a case seeking support for a Fly Nigeria Bill that would soon be presented to the National Assembly to be promulgated into law. The bill seeks to make it mandatory for government officials and those on government sponsored trips to fly only Nigeria airlines.?
Human rights lawyer and senior advocate of Nigeria, Chief Olisa Agbakoba who announced that his firm was working towards such a bill said if it is passed into law, the Fly Nigeria Act would apart from assisting the government to contain issues of capital flight will also be a survival measure for indigenous airlines.
Agbakoba said the bill is being patterned after the United States of America’s Fly America Act which makes it mandatory for American public officers and those on American sponsored trips to use only American registered airlines for their trips.
He explained that his firm is seeking the co-operation of aviation stakeholders, airlines, the National Assembly as well as the Federal Ministry of Aviation to see to the quick passage of the bill which could also be referred to as a ‘Cabotage Act’, within the next two to four months, to enable Nigerian carriers tap into the huge airline market running into billions of dollars.
What The bill Is About
The Fly Nigeria Bill is actually being patterned after the Fly America Act of 1974 and its subsequent amendments.
In an article entitled “Fly America – More Than Just A Name” by Mike Cannon, an authority in the Act, he explained the workings of the act. He said the Fly America Act requires that foreign air travel funded with Federal dollars be performed on U.S. flag air carriers, unless one has a good reason not to. According to him, this applies to all foreign travel funded by Federal dollars which means that these restrictions also apply to Federal Government employees on official travel, not just Federal financial assistance recipients and Federal contractors.
More specifically, the Bill encouraged travel to and from the U.S. on U.S. carriers and required that transportation of Government-financed passengers and property be on U.S. carriers.
He further explained that the Committee that sponsored the bill noted that discriminatory and unfair competitive practices were prevalent in many of the countries where U.S. carriers operated.
“Practices included the uneven application of national taxes, delays and considerable paperwork requirements imposed on U.S. carriers in currency conversions, preferences for the local carrier in accessibility to airport facilities and services, and denial to U.S. carriers of domestic connecting space within a foreign country.
This means primarily that the bill was sponsored to protect the American airlines.
?
Need For A Legislation
So based on the aforesaid, it is not difficult for anyone to understand why industry watchers have supported the enactment of such an act in Nigeria because its implementation would indeed support the growth of indigenous airlines.
This is because the airline industry in Nigeria has witnessed so much failures and the future of the existing ones could not be guaranteed due to harsh operating environment, continuous fall in the value of the Nigeria and so many other problems. Thus stakeholders have argued that the government need to implement such policies that could make for the survival of the existing airlines, for that Nigerians could benefit from them..
Agbakoba had explained that the bill will seek to use some designated Nigerian airlines like Arik Air, Air Nigeria and First Nation Airways as pilot carriers for the project. He further explained that if the Cabotage Act is in place, the aviation industry will experience a new lease of life, in terms of policy, infrastructure and market potential. According to him, Nigerian carriers cannot grow if there is no enabling legislation like the Fly Nigeria Act, which will help to curb huge capital flight.
According to reports, foreign airlines repatriate over N200 billion to their home countries from proceeds of doing business in Nigeria while the indigenous airlines wallow in penury.
Views
Some industry watchers have indeed lauded this move. Particularly, Arik Air believes such a bill will make for the growth of indigenous airlines.
According to the Managing Director of Arik Air, Mr. Chris Ndulue who supported the move to present the bill to the national assembly, its enactment into law and its subsequent enforcement apart from protecting indigenous airlines will also help the country and the airlines to conserve foreign exchange as well as create employment for the population.
However, some analysts have criticised the bill saying that the indigenous airlines are really not ready for such an act. Some of the issues they have raised include the pedestrian services rendered by the airlines, their inability to provide world standard service, disruptions in their flight operations, inability to maintain accurate schedules.
Other issues that have been raised include the scope of operations of domestic airlines.
To support this line of argument, apart from Arik Air which operates flights to the United States and the United Kingdom, other indigenous airlines’ services are limited to domestic destinations and some regional destinations.
So some analysts wonder how with such limited scope of operations anyone would consider promulgating a law like Fly Nigeria Act to protect indigenous airlines. The questions some have asked are of what benefits would such an Act be to the airlines? Of what benefits would it be to any public officers who had a government business to conduct abroad? This line of argument is based on the fact that government business could take one to any part of the world.
In addition, the domestic airlines have not grown their operations to the extent of utilising global alliances, code share agreements, interline services, and several other forms of co-operation in the airline industry that could give them access to more global destinations.
Engineer Sheri kyari, former National President of the National Association of Aircraft Pilots and Engineers (NAAPE) and Convener of Congress of Aviation Unions and Professional Associations? (CAUPA) said though the bill might have its merits, it might be difficult to implement because the indigenous airlines really lack what it takes to make it very functional. He cited the inability of the airlines to belong to global alliances as well as their limited scope of operations, service levels and reach as some of the issues that will work against the functionality of such an act.
His word, “It may be difficult to implement due to lack of interline service agreements by our airlines. Also the airlines do not offer good service, and they have poor customer relations. In short the airlines are not competitive”.
He said it will be better to bring the airlines to a level where their services are comparable to what global airlines offer so that they can benefit from such an act.
Some analysts have also described the bill as being anti competition. They have also stressed the need to make comparison of what airlines like British Airways, Delta Air Lines, Lufthansa German Airlines and other global airlines offer in terms of reach and service to what the indigenous airlines currently offers. Some believe that enacting the act will simply mean handing traffic over to indigenous airlines without their actually implementing services that will make them competitive.
According to Mr. Bayo Babatunde, Aviation Security Expert and industry analyst, the bill is “anti competition”.
However, Arik Air insists the time is actually ripe and that the domestic airlines will be the better for it if the bill becomes law, adding that the airline is continuously working towards upgrading its services to meet the customers’ demand.
Also on the issue of capacity, the airline according to its managing director has the capacity to provide the service for Nigerians, even as he said the airline has capacity that has not been fully utilised by the population.
He, however, agreed that there is a limitation when it comes to global networks, but said Arik Air is working towards entering into global cooperation and agreements that will enhance its operations. On increasing its network, Ndulue said Arik Air would gradually grow its network because the airline is still young and is growing.
Conclusion
As Nigeria prepares for the enactment of such an Act, worthy of note that the Fly America Act to which it is being patterned after was written back in the early 70’s and air travel has changed greatly since the Act was adopted.
As some critics of the act have pointed out, some well- intended purpose during the conception of the Act, now finds its application in conflict with modern day aviation practice. So it is imperative for the sponsors of the bill to conduct serious investigations into issues that might make the Act unworkable.
However, there is no doubt that the nation’s airline market and indeed the indigenous airlines needed to be encouraged. Considering that aviation is a capital intensive industry, those in authority should do whatever they could to encourage the airlines and make them remain in business. As experts would often say, travel by air has always been the safest and fastest way of travel.
?