The Minister of Aviation, Chief Osita Chidoka has said that the Aviation industry in Nigeria required about $50 billion investment to improve and develop the sector in the next 28 years,
He made this disclosure while speaking during the one day Aviation Executives Business Forum ( AEBF), in Lagos affirming that Nigerian aviation sector would not grow owing largely to low direct investment , funding deficiencies untapped regional opportunities for domestic airlines.
Chidoka said the aviation industry could only grow if there are appropriate policies , financial incentives , increased foreign direct investment , stimulation of local direct investment , reduction of industry risks , as well as expansion of aviation financing by banks tailored for the sector’s requirement.
He further said that the aviation industry contributed $0.7 billion (N137.9 billion) in the country’s Gross Domestic Product (GDP), adding that the current GDP in Nigeria was $80.3 billion (N15,819 trillion) saying that the industry had been under utilized.
“We also have weak corporate governance in the industry, poor incentives for private sector participation. That is just exactly what the Nigerian aviation industry needs. By introducing some initiatives, we are beginning to feel the pulse of the industry. Among other initiatives we strongly believe that the industry also need an economic stimulus to drive it even faster than expected,’’ he said.
Chidoka explained that economic stimulus for aviation would involve a package of financial incentives and support across the aviation value chain.
He noted that the key areas to focus on were the aerodrome infrastructure and operation, airline operations and safety.Also the aviation allied services, airspace management and manpower development.
Also speaking, the Secretary General of African Airlines Association ( AFRAA), Dr Elijah Chingosho said many airlines have failed in African due to lack of consolidation among carriers .
He said airlines in Africa would not do well if they operate in fragmented industry stressing that the graveyard of dead airlines is full because many African carriers have failed to forge mergers and partnership.
He said :” In a fragmented industry there will be more casualties of airlines.The grave yard of dead airlines is full. I urge African airlines to stop contributing to the number . The way forward is through partnerships . The days of small carriers are gone . It is for this reason that Nigeria should take its rightful position to grow a vibrant industry where activities are abuzz. Lack of liberalisation remains a major stumbling block to the development of the aviation industry .”
Chingosho noted that African aviation share of global traffic is very small at around three per cent and that West and Central Africa region is the worst served in terms of connectivity and tourism, adding that none of the major airline hubs feature in this region.
He, however, said that there are some airlines trying their best to survive in a fiercely competitive environment which is dominated by non-African mega-carriers.
He further explained that the Industry consolidation was critical; otherwise we would continue to see more airlines going under.