It would be recalled that the Federal Government in March placed a restriction on both local and international flights as part of efforts to contain the spread of the pandemic. The restriction, however, excluded cargo, emergency and essential flights as approved by the Minister of Aviation, Hadi Sirika. The government, last Wednesday, extended the flight restriction by another four weeks.
 
Worst hit is the Federal Airports Authority of Nigeria (FAAN) that has thousands of staff spread across all 22 airports nationwide. With almost nothing generated in revenue in the last one month, FAAN will require the Federal Government’s support to defray N4b monthly overhead costs.
 
Aviation consultant, Chris Aligbe, said all government parastatals in the sector depend on airlines’passengers, and the bulk of the revenue is from foreign airlines that have all been shut out because of the Coronavirus.
 
Aligbe said the government would have to support both the airlines and regulatory agencies, because they are mutually interdependent. He said: “If airlines do not pick up to the level of pre-COVID-19, then the revenue will not come to the agencies too. More so, we don’t expect normalcy to return (to air travel) until about 18 months. Because, in the absence of vaccines, travellers will still be afraid of infection, and there will be restrictions in some countries. Also, due to economic recession, lack of funds will prevent people from travelling like before. This will have serious impact on airports and travel agencies.
 
“I worry very much about FAAN. If you leave the carrousel unused for one month, for instance, it will get cranky. So, you need to keep maintaining the airport infrastructure so that they will work properly the day that operations will resume. Unfortunately, apart from Lagos and Abuja airports, all others are running at a deficit,” Aligbe said.
 
Meanwhile, IATA has called for aviation-specific financial relief measures from the government to address the severe impact of COVID-19 crisis on the air transport sector.
 
The body observed that along with the direct impact on jobs and companies in aviation-related industries, including tourism, hospitality and trade have all been hit hard despite all playing essential roles in creating jobs and powering economies.
Prior to the crisis, aviation contributed $1.7b to Nigeria’s GDP and supported 241,000 jobs, IATA stated.

IATA’s Regional Vice President for Africa and the Middle East, Muhammad Albakri, acknowledged that the Nigerian government had introduced broad economic relief packages to mitigate the devastation caused by COVID-19, but the body is now urging the government to implement specific financial relief measures for aviation in order for the sector to be capable of driving the recovery.

Albakri said: “Nigeria has announced general relief measures for sectors affected by COVID-19, but not specifically for aviation. Given the importance of air transport for Nigeria’s economy and connectivity, the government must not let aviation fail.
 
“The industry faces a liquidity crisis. Without a viable aviation sector Nigeria’s eventual recovery from COVID-19 will be longer and even more painful. Aviation-specific financial relief measures are urgently needed as a matter of survival,” he said.
   
IATA advised the government to consider implementing some or all of the following relief measures like direct financial support to passenger and cargo carriers, loans, loan guarantees and support for the corporate bond market by the government or Central Bank.
 
Also, tax relief and rebates on payroll taxes paid to date in 2020 and/or an extension of payment terms for the rest of 2020, financial relief on airport and air traffic control (ATC) charges and taxes, reduction, waiver or deferral of government-imposed taxes and fees and foreign exchange availability.
“As the aviation industry looks to restart, it is important that key regional players like Nigeria are ready and able. Aviation is a strategic pillar for social and economic development. Supporting aviation now will mean that Nigeria’s economy can pick up from where it stopped and drive forward,” Albakri said.

SOURCE: The Guardian (Nigeria)