The high stakes of excluding ground handlers from aviation palliatives

For decades, the Nigerian aviation narrative has been dominated by the survival of airlines. However, a new concern has emerged for industry sustainability as the Aviation Ground Handlers Association of Nigeria (AGHAN) demands a seat at the table of federal incentives.

While the government has recently rolled out palliatives to keep domestic carriers airborne, the downstream of the industry—the ground handlers who manage everything from ramp safety to baggage logistics—warns that the ecosystem is on the verge of a structural collapse.

The debate, which moved to the forefront following the suspension of a planned industry strike over N9 billion in airline debts, has now evolved into a fundamental question of economic justice: Should a sub-sector that provides the foundation for flight safety be left out of national relief frameworks?

Read also: Ground handlers suspend strike as airlines sue for peace

The argument for equality

Olaniyi Adigun, AGHAN Chairman, argues that the current “piecemeal” approach to aviation palliatives ignores the fact that ground handling is a capital-intensive sub-sector facing the same macroeconomic headwinds as the airlines.

“You can spend multi-million dollars to acquire an aircraft, but safety starts from the ground,” Adigun told BusinessDay. “Anything not properly done on the ground can crash a plane. We are all facing the same challenges, high cost of aviation fuel, diesel for ground equipment, insurance, and forex volatility. The Minister is a father to all; he should beam his searchlight on other service providers and assist them to grow.”

He said while the airlines have their own problems, services have been rendered and they need to be paid for, irrespective of the excuses they have.

“I believe the excuses can be sorted out – incidents at the ramp and others. Globally, incidents and accidents do happen and there are lots of procedures to be followed by all parties. For instance, we have the insurance companies that should take care of whatever incident or accident at the ramp.

“Again, if you continue to hold on to this money, how do you expect the airlines to survive? How will they pay the insurance premiums? How will the insurance companies compensate the affected companies? The situation is negatively impacting on the operations of the ground handlers, the welfare of their staff and other activities, too,” he explained.

This call for “Policy Parity” is supported by Olumide Ohunayo, Director of Research at Zenith Travels, who contends that ignoring private investors in the handling sector is a recipe for long-term economic friction.

“Ground handling companies are privately owned just like the airlines. Whatever incentive is given to one section should flow round to other investors who have brought in funds to keep the nation going,” Ohunayo noted.

He suggested that all other private investors in the aviation ecosystem being affected by fuel price directly or through their services to the airlines should also be considered.

Read also: Uncertainty at Abuja airport as ground handlers await strike directive 

Profitability vs. palliatives

However, the push for incentives has met with stiff resistance from some quarters of the industry. Chris Aligbe, CEO of Belujane Konsult, offers a sobering counter-argument based on the “margin of profitability.”

Aligbe asserts that ground handlers and airport concessionaires often enjoy higher profit margins than airlines, whose bottom lines are notoriously thin. “It is not really necessary [to give handlers incentives],” Aligbe argued.

“The airlines’ margin of profitability is very low, and anything that distorts their operational costs impacts them far more. The handlers don’t use fuel as much as the airlines do; they must show a unique justification for such intervention.”

Beyond palliatives: Seeking structural solutions

While the debate over cash incentives rages, other experts are calling for a complete redesign of the industry’s financial architecture. Samuel Caulcrick, former Rector of the Nigerian College of Aviation Technology (NCAT), suggests that the ‘incentive’ could be structural rather than liquid.

He advocates for the discounting of handlers’ obligations to the federal government and the creation of a “singular financial clearing institution.”

“The prayers of the local airlines were not fully answered, such as a review of the five percent TSC/CSC,” Caulcrick explained. “But future debts could be avoided if all transactions were processed through a dedicated vehicle like the proposed Aviation Development Bank.”

Amos Akpan, MD of Flights & Logistics Solution Ltd, warned that Nigeria cannot continue to apply “fire brigade” solutions to recurrent problems.

He pointed to the Akwa Ibom State aviation model—which integrates MRO facilities, power plants, and cargo terminals—as the “thinking pattern” the national government should adopt. “Airlines, handlers, and fuel suppliers are all interdependent. We need to redesign the framework so the industry becomes a launchpad for economic development, rather than a series of emergency interventions,” Akpan said.

Read also: Why aviation handling rates no longer sustainable – Ground handlers

The regulatory oversight

As the N9.billion debt continues to loom, all eyes are on the Nigeria Civil Aviation Authority (NCAA). AGHAN leaders liken the NCAA’s role to that of the Central Bank, urging the regulator to enforce financial standards that prevent airlines from “relocating” their business to a new handler while still owing millions to another, a practice handlers describe as “unhealthy competition.”