• Friday, March 29, 2024
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Import, export of aircraft, spares improved Nigeria’s revenue potentials in 2022 – Adewale

Import, export of aircraft, spares improved Nigeria’s revenue potentials in 2022  – Adewale

Seyi Adewale is the chief executive officer – Mainstream Cargo Limited. In this interview with Ifeoma Okeke-Korieocha, he speaks on the successes recorded in Nigeria’s aviation sector in 2022 and what the federal government can do to prevent drawbacks suffered by the sector. He also hints that the import and export of aircraft and their spares have boosted Nigeria’s revenue potentials. Excerpts:

How would you describe the achievements or successes in the aviation sector in year 2022?

Nigerian Aviation Sector actually recorded significant milestone achievements and successes in 2022. Firstly, Aviation is synonymous with Safety and this has been sustained seven years ongoing with non commercial aircraft accidents save for one helicopter accident in Opebi. This is further confirmed by the significant reduction of aircraft insurance covers for our domestic (aircraft) airlines from about $800,000 to about $150,000 for wide body aircrafts.

Kudos must be extended to the Nigeria Civil Aviation Authority (NCAA) and other associate supporting aviation agencies including FAAN for this feat. Other notable achievements include the runway 18L/36R lightening of Nigeria’s largest domestic hub, Lagos Domestic Airport and the opening of the new international terminals especially Lagos International Airport Terminal 2.

We have had continued new entrants into domestic airline operations (eg. ValueJet), newer and cleaner aircraft fleets than old high-maintenance aircrafts deployed in the past. Importantly, the Nigerian Civil Aviation Act 2022 was signed into Law and thereby repealed the former 2006 Act that now empowers NCAA to better monitor, oversee, regulate, and coordinate the sector. The Act now brings Nigeria up-to-speed with ICAO guidelines for same.

What were the expectations and failures in the sector and why do you think the relevant authorities didn’t live up to these expectations?

Noting that 2022 has largely been positive in the Aviation sector there were few drawbacks. These include Higher Air Fares for both Domestic and International routes; increasing flight delays and cancellations probably due aviation fuel crises, revenue repatriation row between government and foreign airliners and notably seeing the exit of Emirates Airlines from Nigeria and their further strange stop to issuing tourist visas to Nigerians.

The federal government will do well to intervene through the Federal Ministry of Aviation, Federal Ministry of Foreign Affairs, the Central Bank of Nigeria (CBN) and other critical agencies including NNPC to find ways to resolving these issues and further find common grounds for the betterment of all parties and to the overall benefit and delight of the Nigerian (traveling) citizens.

When the year started off, aviation fuel price tripled, foreign exchange rate almost tripled as well. These developments had such an impact on airlines, that some had to suspend operations at some point. What would you suggest the government can do in 2023 to mitigate effects of shocks like these that may still occur in 2023?

Despite the advent of global crises fuelled by continued pre and post Covid impacts as seen in the zero covid policy implemented by China that affected global supply chain (production) and also the impact of the Russia-Ukraine continued ‘war’; Nigeria can do better by taking advantage of the opportunities these crises presents. Some of these opportunities include capitalizing on the significant global oil price surge that could improve our dollar earnings.

We need to meet at the very basic minimum our opec production quota and build oil reserves for posterity sake. Achieving this will solve many of our domestic problems such as high Naira-Dollar exchange rate that impacts many factors of production including aviation in Nigeria.

This will also help improve dollar allocation to foreign airlines for the repatriation of their generated earnings. Nigeria’s name would be removed from the list of countries significantly owing its foreign airline partners as being published and advertised by International Air Transport Association (IATA). Another major need would be for government to continue to enhance, support and encourage non-oil exports as another veritable means of foreign exchange earning.

Did Nigeria do better in exports and imports of air cargo in 2022 than it did in 2021? And why?

Imports generally do not signify real growth in our economy unless it is used as a factor for production and not consumption. I believe with the ‘restraining’ or ‘controlled’ policies of government and its agencies, our imports are on a slight decline as compared with previous years.

However, we have marginal growth in exports due to the enlightenment of populace (via Nigerian Export Promotion Council (NEPC) for example) that has been geared towards promoting non-oil exports (especially agricultural products and produce) but still limited by the high airline export cost that is pegged to the dollar. The actual / real figures will be published by FAAN in Jan 2023 and we eagerly await these official data.

Did you notice any major change, addition of subtraction from the nature (goods) exported from Nigeria in the year 2022?

The main observation has been firstly, the export of food items and perishables are increasing with Nigerian Agricultural Quarantine Services (NAQS) getting very busy and secondly, the movement of domestic airline aircraft parts including those for ‘repair and return’ are on significant rise. The airline aircraft and aircraft parts has significantly improved the revenue potentials in the country generally.

Will you say Nigeria is doing its best to encourage exports by air? What would you suggest can be done better?

I actually believe we are on the right part judging from policies and interventions from the Federal government, its relevant agencies such as NEPC and the support from our external or sovereign entities such as the African Development Bank (AFDB). The federal government gave grants to strategic organisations including ground handling companies for up N1Billion grant per company and to ‘build and operate’ export processing centers across the six geo-political zones.

Also the AFDB $210million loan for Africa special agro processing zones in collaboration with the federal government is an audacious stance by the bank to accelerate, significantly impact exports in Nigeria. NEPC has been doing a lot to enhance, encourage and promote non-oil exports and there is the further need expand trainings/ awareness to Nigerian farmers in the area of globally acceptable practices in the use of fertilizers, allow for traceability and improve packaging. If all these is done with speed, Nigeria will achieve her non-oil export objectives in the nearest future.

Read also: Lekki Port to build Truck Park to ease cargo movement, control traffic

How has Mainstream Cargo Limited been able to operate seamlessly amid the economic downturn?

Mainstream Cargo Limited has been able to grow and outperform yearly by sticking to professionalism, working within the customs rules & regulation, executing learnt principles of excellent customer service, openness/ transparency, good documentation and partnerships.

We always strive to look for ways to continuously improve our efficiency, service delivery and communication to/ with our customers. We also look for ways to save cost for our clients and in our operations. Lastly, we have good forecasting capabilities that always position us in a vantage way before our competitors can respond to rapidly changing business environment.

What were major milestones Mainstream Cargo Limited achieved in 2022?

Some major milestones were being a customer-focused organisation, we retained all our corporate customers and in fact added new corporate customers we targeted in the past years; our modern warehouse at Ibeju Lekki is now in operations and effective use; we grew workforce by 25 percent; we retained our World Cargo Alliance (WCA) Membership and; we organized an export promotion seminar in partnership with NEPC and Business Network International (BNI) early December 2022.

What are the goals of Mainstream Cargo Limited in 2023 and any plans to diversify anytime soon?

Our first goal is to improve our sustainability efficiency. The second is to continue with our diversification plans for real assets that complement our customs & freight forwarding business. Our final goal is to ensure the continuous growth, development and satisfaction of our personnel.

What are your unique selling points?

Our unique selling point is our ability to strive towards ‘perfection’ in all areas of customer service and operations no matter how it may be perceived as utopian. Our communication skills, client advisory services and speed of execution separates us from peers operating within our horizon.

Has there been implementation of import duty waiver policies on aircraft spares?

Yes, it has been implemented following the adoption of new finance act that enabled NCS to introduce Procedural Code Ext. 436 (for Commercial Airlines) and thereby remove Import Duty Exemption Certificates (IDEC) as the vehicle for waivers.