Nigerian airlines are preparing to take advantage of the ‘open skies’ policy of the African Continental Free Trade Area (AfCFTA) agreement, as they make plans to commence flight operations into African destinations.
One of the objectives of AfCFTA is to create a single market for goods and services facilitated by the movement of persons in order to deepen the economic integration of the African continent and in accordance with the Pan African Vision of “An integrated, prosperous and peaceful Africa.”
This is also in accordance with the Single African Air Transport Market (SAATM), a project of the African Union to create a single market for air transport in the continent. Once completely in force, the single market is supposed to allow significant freedom of air transport in Africa, advancing the AU’s Agenda 2063.
To leverage these opportunities, local carriers are getting new aircraft that suit regional routes and speaking with civil aviation authorities in Nigeria and other African countries to secure licences to operate into these countries.
For instance, Air Peace has received three of its new Embraer 195-E2, out of the 13 firm orders it made, which would all be arriving in the country before the end of 2022. These aircraft will be deployed to West Coast routes and South European countries. Air Peace is deploying its planes to Accra, Dakar, Freetown, Banjul, Douala and Monrovia.
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Also, Ibom Air recently took delivery of two new aircraft – Airbus A220 series – bringing its aircraft fleet to seven. The bigger Airbus will complement the currently owned Bombardier CRJ-900, which have fewer seats, signalling Ibom Air’s plan to go regional in its operations.
Also, prospective Green Africa is deploying a number of turboprops aircraft and eyeing the West Coast region.
Seyi Adewale, CEO, Mainstream Cargo Limited, notes that Nigerian airlines are surely preparing to take advantage of the open skies AfCFTA opportunity presents.
Adewale says the aviation industry is witnessing brand new aircraft purchases for regional flights and many local aircraft orders by emerging airlines with air transport licences.
He lists some advantages of operating regional routes to include foreign exchange earnings, managing currency risk and gradually getting Nigeria on the global traffic map.
BusinessDay’s checks show that an hour economy flight within Nigeria ranges from N30,000 to N35,000, whereas it costs at least $200 to operate an hour regional flight.
With an exchange rate of N500 to a dollar, passengers pay N100,000 for a one-way flight from Nigeria to any African country.
For Olumide Ohunayo, an aviation analyst, the responsibility of making airlines viable to tap into AfCFTA as signed by the Nigerian government does not rest on the airlines alone.
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He says AfCFTA can work for airlines if the government’s policy on immigration is favourable, airport facilities are top-notch and opportunities for the business enterprises to stretch across the Niger.
“It is a gambit, which also includes the ability to convert our own currency and bring down the exchange rate to attract more people to the economy. The airlines have to work together to get the best out of the economy. The airlines alone cannot do it; other travel-related issues need to be addressed even up to passport and visa entry qualifications,” Ohunayo states.
Airlines make more money on the West Coast than on local routes when they use the appropriate aircraft such as the ones used by Awa Airlines into Nigeria, he says.
He observes that Turboprop and jets below 100 seat capacity would be fuel-efficient and have good turn-around time for airlines operating regional routes.
According to Obiora Okonkwo, CEO, United Nigeria Airline, the airline plans to expand its operations in the long run and would take delivery of more aircraft to serve more routes.
“We are going to increase our fleet, we have four aircraft already, we are negotiating and finalising with the next two Embraer, by then, we would have consolidated on certain routes, we would have consolidated on certain passenger loads and we have plan thereafter to probably consider a larger body aircraft,” he says.
Allen Onyema, Chairman, Air Peace, also says the airline plans its acquisition to tailor the kind of operations it wants to do, which include regional routes and its Embraer acquisition is expected to suit this.
“The Embraer 195-E2 is a good aircraft for 30 minutes to one hour flight, and at the same time a good aircraft for five to six hours flight. So, there are double advantages for us. We have regional and international routes for this aircraft type,” Onyema says.
