• Wednesday, April 24, 2024
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FG to revive airlines through Aircraft Leasing, MRO facilities

FAAN staff spent almost N1 billion shuttling Lagos – Abuja in 2023, says Minister

The Federal Government has unveiled a plan aimed at revitalising Nigeria’s aviation industry through initiatives such as aircraft leasing and Maintenance, Repair, and Overhaul (MRO) facilities.

Festus Keyamo, the minister of aviation and aerospace development, announced this ambitious initiative on Tuesday via his official X page.

Read also: FG’s aircraft leasing company stalled seven years after

Keyamo highlighted the pivotal role of aircraft leasing, particularly dry leasing, in bolstering the operations of local airline operators, noting its significance in the global aviation landscape.

He emphasised that even major airlines worldwide depend on dry leasing, given the financial constraints of purchasing an entire fleet outright.

“No airline company in the world or even any Government for that matter can afford to purchase its fleet of aircrafts one hundred percent. The biggest airlines in the world depend on dry leasing in particular,” he said.

Read also: How country risk, reputation make aircraft leasing difficult in Nigeria – Okonwo

The minister underscored the importance of establishing MRO facilities to enhance the growth and efficiency of Nigeria’s aviation industry.

“One other factor, amongst others, is the establishment of MRO facilities within the country. We are currently wooing investors in this regard”, Keyamo stressed.

He acknowledged ongoing efforts to attract investors for these facilities, recognising their critical role in supporting the sector’s development.

“Should Government completely abandon local operators to fend for themselves? What can Government do to help in this regard? It is simple: Government should provide the enabling environment for these businesses to thrive by providing the assurances to Aircraft manufacturers and leasing companies around the world that their aircrafts are safe within the country if they lease them to our businesses here; that includes assurances and guarantees that these creditors can secure their assets anytime there is a default”

“This is in line with the Cape Town Convention to which Nigeria is a signatory. It is our duty as Government to provide this comfort and assurance to the potential lessors. We are currently on top of that and the package would be revealed soon. The lack of this is ONE big factor that has led to the high mortality rate of airlines in Nigeria in the last 40+ years. There are other factors too”

Keyamo expressed the government’s determination to engage aircraft leasing companies and manufacturers, emphasizing the necessity of creating an enabling environment for potential foreign investors.

“We are determined to go far and near to woo Aircraft Leasing Companies and Aircraft Manufacturers to come to our aid. There is no shame in doing this now since we lack capacity to produce our own aircrafts or to purchase them”

He stressed the importance of providing assurances to these companies regarding the safety of their assets within Nigeria.

Keyamo reiterated the government’s commitment to addressing longstanding challenges in the aviation sector and affirmed its proactive stance in fostering partnerships to drive growth and sustainability.