The current spike in the exchange rate of the dollar to the naira may be
taking its toll on the country’s foreign-exchange-dependent aviation sector as
airline operators seek to increase their fares by 45 per cent.
The dollar exchange rate, which currently stands at N350, according to
the airline operators, has further pushed the cost of running the business
beyond them.
Some operators told The Guardian that their plight was not helped by the
Nigerian Civil Aviation Authority (NCAA) disapproval of a new air fare regime
that should have officially gone up by 45 per cent, to keep pace with the
dollar rate.
Some airlines, however, appear to have resorted to self-help in raising
ticket prices for over-the-counter purchase.
The act, which is described as a sharp practice by NCAA’s rules, has
seen some tickets gone up by N10, 000 to N20, 000, depending on the airline and
the time of purchase.
An operator, who is also a leading member of the Airline Operators of
Nigeria (AON), told The Guardian on the condition of anonymity that the current
fare regime, in relation to foreign exchange, was not realistic.
He said: “The current rate is killing our business and it seems our
regulators don’t care if we go into extinction. The truth is that this sector
cannot survive under the current realities. You cannot do anything without the
dollar, which is not in any way favourable.”
The operator added that several planes were either due for checks or had
been sent for the same purpose overseas but still could not be returned due to
the further high cost of service caused by the forex spike.
It would be recalled that the aviation fuel scarcity that almost
grounded operations nationwide last week was due to oil marketers’ staunch
refusal to import the product, otherwise called Jet-A1, into the country at an
exchange rate higher than N300.
The situation had to be salvaged by the Federal Government’s
intervention that availed forex to the importers at an interbank rate.
On the heels of the scarcity and attendant hardship on air travellers,
The Guardian observed that rates, which normally range between N18, 000 and
N23, 000 for economy class across the airlines, went up to about N30, 000 to
N39, 800. The price is subject to the time of purchase and airline of choice.
Some operators have, however, openly supported the hike. A former
manager of the defunct Chanchangi Airlines, Mohammed Tukur, at the weekend said
that the airline operators had been boxed to a corner by the current harsh
economic condition, and left with no choice than to raise fares.
Tukur, who was also the Assistant Secretary-General of the AON, added
that the carriers were in dire straits, but would survive if fares were raised.
“You look at the dollar; you now buy everything in dollar. Airline
business is heavily dollarised. Maintenance cost has gone up, the airlines pay
so many charges to the aviation agencies, among other sundry charges. It should
not be less than N35, 000 if they really want to break even. Their fear is that
if they raise airfare, people would take to road travel. It is still very cheap
to fly in Nigeria.”
The NCAA had, however, denied raising ticket fares for local airlines.
The aviation regulatory body said though airfares, add-ons, charges, tariffs
and terms and condition of service are fully liberalised, they are all subject
to NCAA’s approval before coming to effect.
The spokesman for the NCAA, Sam Adurogboye, said airfares and sundry
charges had been statutorily deregulated and subjected to market forces.
He said that notwithstanding, all air carriers or their agents were
expected to file with the authority, a tariff for that service showing all
rates, fares and add-on charges, including the terms and conditions of free and
reduced rate transportation for that service, as specified in IS.18.14.1.1.
Another requirement for airfare raise is for the carriers to obtain
approval from the NCAA to introduce and or increase add-on charges or
surcharges such as fuel, Internet booking, insurance, security and similar
surcharges, prior to implementation.
Meanwhile, the Minister of State for Petroleum, Dr. Ibe Kachikwu has
assured that the Federal Government is doing everything possible to tackle the
scarcity of aviation fuel.
Kachickwu
who spoke yesterday to aviation correspondents at the Nnamdi Azikwe
International Airport, Abuja said the sector had been privatised and the
production of Jet A1 was entirely in the hands of the private sector. He said
the government had been trying to work with the private sector to douse the
rousing tension.
Kachikwu disclosed that in the short term, he had been trying to liaise
with countries where there is immediate availability of the product, and in the
long term, the government would resume the Jet A1 production in the refineries.
“Every one of us, including the newly sworn in General Managing Director
of the Nigeria National Petroleum Cooperation (NNPC) are doing our best to find
a short-term solution to this problem before looking at the systemic problem
and how it has affected the private sector to provide the aviation fuel.”
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