Airlines operators seek
govt's aid over fuel cost, others
AS a way out of their predicament, airline operators in the country have appealed for a special financing package in a form of soft loan at a low interest rate and with extended payment period.
The call is coming as the Nigeria Labour Congress (NLC) at the weekend said there is no going back on its planned rally against the moves by the Federal Government to deregulate the downstream sector of the oil industry.
The operators, under the aegis of Airline Operators of Nigeria (AON), said that such loan could be termed the National Airline Financing Fund (NAFF) as recommended by the Air Chief Marshal Paul Dike Presidential Committee in 2006. Part of the recommendations, particularly on safety issues, had been implemented, while others are still begging for government's attention.
Air Marshal Dike had in his 2006 report recommended that airlines in the country should be assisted through soft loan that would help them remain afloat and take away all the pressure which might make them cut corners and endanger the lives of air travellers.
Former President Olusegun Obasanjo had in 2005 set up the Dike Presidential Committee to look into the spate of air disasters that occurred within that period in which over 200 people lost their lives.
In a position paper of the operators, signed by the Secretary General of AON, Captain Muhammed Joji and presented to President Umaru Musa Yar'Adua, the body noted that the normal banking sector of the economy lending portfolio cannot assist airlines' growth.
According to Joji, a foreign bank loan of $2 million for a five-year tenure and seven per cent per yearly will attract interest payment of $360,000 (N54.7 million) over the period.
A Nigerian bank lending system of same amount converted into Naira over the same five-year tenure at the lowest lending rate of 18 per cent, according to the AON chief, will have an accumulated interest payment of N161.8 million.
He said it is impossible for any airline to survive in this regime of lending portfolio.
On other areas of government's assistance to the airlines, he noted that the general agreement on Trade and Tariff and Trade and Services worldwide exempt the airlines from the payment of duties on aircraft and spare parts.
On April 3, 2007, according to the airline operators, the government granted waiver on Customs duties on aircraft, the spares, engines and test equipment, but it was never implemented. Other issues that have agitated the minds of the operators are high price of aviation fuel, Value Added Tax (VAT) on air travel and FAAN charges.
Nigeria, they said, is the only country in the world where aviation kerosene, otherwise known as JET A1, is more expensive than Premium Motor Spirit (PMS), just as they decried the attitude of the marketers whom they accused of taking advantage of the deregulation of the industry.
They suggested that all the major stakeholders and the executive arm of the oil marketers be invited for dialogue. The effect of the joint meeting in the past by the Senate, they stated, compelled the marketers to reduce their pump price from N130 per litre down to N80 per litre.
Speaking yesterday in Abuja on the ongoing dialogue between the NLC and the government, the Deputy President of the NLC, who is also acting as President, Promise Adewusi, said whether or not the government goes ahead with the proposed deregulation, the planned mass protest against the policy will hold nationwide.
Adewusi, who led the meeting between the NLC and the Federal Government, said in an interview with Labour Correspondents in Abuja yesterday that Nigerians should expect the most vociferous protest ever witnessed in the country.
According to Adewusi, the government shamelessly called the NLC to help galvanise support for a policy to which the Congress has expressed its disdain in an unequivocal voice.
His words: "We don't need a prophet to tell us that the price of fuel will increase, because deregulation in Nigeria is very synonymous with price increase. Already, we have prices being brandied about that a litre of PMS will go to N104, and some other time, they said N94 a litre.
"Nigerians should be very prepared to pay more and that is why we are calling on them to join the NLC to come out in their large numbers to protest the move. The NLC is ready to lead the way, and as usual, will not disappoint Nigerians, but they must also come out to support the efforts. We are prepared to mobilise from North to South, East to West to stop the few from enjoying our common wealth."
Though his involvement in the meeting at this stage was informed by the absence of NLC President, Abdulwaheed Omar, from the country, Adewusi said the meeting was used to drum the Congress' opposition to the ear drums of government officials that were present in case they were yet to hear the NLC's voice of opposition to the move in the last few months.
Adewusi said: "As you know, I am just a Deputy President of the NLC, but directed to lead the meeting in the absence of our President Omar. On our meeting with the Federal Government, I will say, is essentially explorative. We seized the opportunity to re-inforce our opposition to deregulation and we also insist that should government go ahead to carry out deregulation, we are going to mobilise Nigerian people to come against this further act of aggression against our people. Whether they go ahead or not, on the 29th of this month, we are mobilising the Nigerian people in a very massive rally in Abuja against the total deregulation of the downstream oil sector.
"Basically, they wanted to acquaint us with their reform in the petroleum industry, particularly as it affects the downstream sector and also to deny that what we found in the newspapers were merely speculations, that they have not taken a date for the commencement of the policy.
"They also seize the opportunities to tell us why government thinks about deregulation. After that, what we did was to confirm if truly they have made up their mind to deregulate the sector, and told them that in the Nigerian context, deregulation is a direct translation to petroleum pricing increase. After the clarification, our worry was that they told us that their greatest challenge is how to win the confidence of Nigerians in the whole process.
"In our response, we said since you are confirming to us that you want to deregulate, and that since deregulation is tantamount to fuel price increase, we are opposed to it, and we are not going to buy into it. We went ahead to give them the reason."
Recalling how the NLC team justified its thinking about the deregulation, Adewusi said: "As I speak with you now, the price of diesel is between N120 and N250 depending on the part of the country. We said this could not work because there is no way you can win the confidence of Nigerians with that kind of argument. It is the same thing with kerosene. Kerosene is not only scarce, it is totally expensive."
The Senior Staff Association of Nigerian Universities (SSANU) has declared that the Nigerian people are already over-burdened with poverty and want even in the midst of prosperity, adding that deregulation is a bad product no matter how it is window-dressed.
"If your challenge is how to win the confidence of Nigerians, then deregulation is a very bad advertisement because of the centrality of oil in the economic calculation of the country. It has become like the nerve centre. Once you touch it, you touch every other part of the body. Nigeria has become a generator-driven economy, industries are closing down because there is no electricity," he said. |
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