As the Federal Government hinged the decision to resuscitate Nigeria Air, which was suspended in 2018, on its economic diversification quest, job creation potential and contribution to national GDP, some stakeholders have faulted the timing, argues that it is coming at a time of lean federal resources and global aviation downtime.
The stakeholders stated that “At present, dividends are very low for existing investors as the airline business suffered heavy losses due to the impact of the shutdown of airspaces globally following the outbreak of COVID-19. Most of the leading global airlines have scaled down operations and have sacked workers, including pilots and engineers.”
The need for aggressive diversification of the Nigerian economy, no doubt, has gained currency in recent weeks and the government is right in seeking to boost earnings from a non-oil sector, like aviation.
This came to play when the Minister of Aviation, Hadi Sirika, was at the Senate to defend his ministry’s 2021 budget and revealed the Federal Government’s vision for the aviation sector, with the resuscitation of Nigeria Air, the proposed national carrier, and other critical aviation infrastructure as top priority. And also noted that the government has earmarked N78billion for the projects.
“Nigeria’s economy faces unprecedented headwinds in the fourth quarter and in the first quarter of 2021. The challenge is to get through the storm of a weakened economy facing internal and external threats and reach a place where there is smoother sailing. Now more than ever, it is important to keep diversifying the economy and make provisions for a calmer future where Nigeria can recover from its recent trials,”Otunuga said.
Aviation analyst and member, Aviation Round Table (ART), Olu Ohunayo, who supported the need for increased investment in the aviation sector to unlock its full potential for economic growth, however, said resuscitating the Nigeria Air project, with government equity, was not the best option, at present.
“I will not support the Federal Government to establish something afresh, like a new national carrier. I would rather that such money be used in supporting the emergence of a flag carrier from existing local airlines where the Federal Government holds equity,”Ohunayo told Daily Sun in an interview.
Lagos-based economist, Andrew Esegubo, also disagrees with the idea of restarting a national carrier project saying “committing huge capital into a national carrier at a time of lean national resources and struggle to meet other competing basic socio-economic needs of citizens is not the best of priority and makes no economic sense.”
“Even if the intention is right, the timing is definitely wrong; there are better things to do with our scarce resources. There are critical infrastructure like schools, hospitals, roads all over the country in terrible shapes begging for attention. And there is the challenge of hunger and poverty occasioned by COVID-19 fuelling anger among the young people. These are areas that government should divert resources to rather than a national carrier project that the private sector can effectively handle with the right support,” he said.