A projection by the federal government to raise $250 million for the proposed national carrier is raising questions among operators in the aviation industry.
According to a document released last week by the aviation ministry, the federal government expects private investors to raise $250m for the proposed carrier as it insisted the project would be delivered before 2023.
In the document which gives an update on the national carrier project and other sub-projects in the roadmap, the Ministry of Aviation explained that the project development phase has been completed.
The government explained that the next phase would be the placement of Request for Qualification (RFQ) in local and international media.
“$250m approximately is to be raised to start up the airline by private investors,” the document stated.
But stakeholders doubt the feasibility of the project, saying investors might be unwilling to put their money in such a venture.
Rather, some of them called on the government to harvest the facilities of the airlines under its management to set up the national carrier.
The Managing Director, Flight and Logistics Solutions, Amos Akpan said it would be an uphill task for private investors to invest $250m in establishing a national airline.
He attributed the difficulty to several factors such as return on investment (ROI), business environment, among others.
He said, “Positioning to attract investment is more critical now. If the gestation of investment runs into the next government coming in 2023, will it affect the agreements established with this government?
“Nigerians still experience discriminatory aircraft leasing agreements and insurance programmes. We are still trying to effect the implementation of no duty on aircraft spare parts.
“The forex regime is yet to accommodate airline operators. Interlining and cooperation is still at the concept stage. Let’s fix the platform or foundation first before we can build or launch on it.”
In his remarks, aviation analyst and Head of Research Zenith Travel, Olumide Ohunayo, stated that there is no amount too small for a national carrier if there is high credibility and contact with lessors, aircraft manufacturers and other airlines.
Group Captain John Ojikutu (rtd), an aviation analyst, wondered what $250m would do for the project and the would-be investors.
“Private investors will include foreign and local; how much is $250m in a national carrier or how many aircraft would that buy? How much would government investment of 10% be in the national carrier? If we want a national carrier let it be now or we better go for a flag carrier and the government take a rest from the journey it started in 1993 when the national carrier became a government airline.”
But another analyst, Mr. Chris Aligbe, said raising $250m for the project would not be difficult, noting that there are many investors who are willing to put in their money on the project.
According to him, the $250m would be more than enough to start off the project depending on the strategy being adopted.