Beyond 30% Airline Debt Relief, Economist Calls For Aviation Fee Reform

An economist, Dr Muda Yusuf, has urged the Nigerian government to pursue sweeping reforms in aviation fees, arguing that the recently announced 30 per cent debt relief for local airlines falls short of addressing deep-rooted inefficiencies crippling the sector.

While welcoming the federal government’s 30 per cent debt discount for airlines, Dr Yusuf, also the director/CEO of the Centre for the Promotion of Private Enterprise (CPPE), has called for urgent, comprehensive reform of Nigeria’s aviation cost regime.

He said charges spanning ticket sales, landing fees, cargo levies, and import duties remain excessively high and fragmented, warning that the burden is incompatible with thin airline margins and contributes to the sector’s high mortality rate.

According to him, the intervention provides timely relief to operators grappling with escalating, unsustainable operating costs.

He acknowledged the proactive support of the minister of Aviation and Aerospace Development, Festus Keyamo, whose consistent engagement with industry stakeholders has been impactful and commendable.

“However, while the debt discount offers short-term respite, it does not address the deeper structural cost challenges confronting the aviation sector. The burden of multiple taxes, fees and levies imposed by key agencies, including the Nigerian Civil Aviation Authority (NCAA), the Federal Airports Authority of Nigeria (FAAN), and the Nigerian Airspace Management Agency (NAMA), remains excessively high,” Yusuf said.

According to him, industry estimates suggest that these charges collectively account for as much as 35 per cent of airline revenues, a level that is clearly incompatible with the thin margins typical of the aviation business.

“Nigeria’s aviation sector is too strategic to be weighed down by such cost pressures. It is central to economic connectivity, trade facilitation, investment flows, business mobility and national integration.

“The sector has also become even more critical because road travel has become increasingly unsafe in many parts of the country, compelling many Nigerians to opt for air travel as a safer alternative.”

He added that the sector continues to suffer from a persistently high airline mortality rate, largely reflecting the difficult and hostile operating environment.

Yusuf urged the federal government to undertake a comprehensive rationalisation of aviation charges, saying that the current regime spanning ticket sales charges, cargo sales charges, passenger service charges, landing and parking fees, aircraft inspection charges, administrative and facility fees, boarding bridge charges, fuel-related charges, and import duties on aircraft and spare parts is overly burdensome, fragmented and detrimental to the sustainability of domestic airline operations.

He insisted that government support for the aviation sector must go beyond debt relief, saying that “what is needed is a comprehensive reform of the aviation cost environment to ensure that domestic airlines are not overburdened by charges that undermine investment, weaken service quality, raise ticket prices and threaten the long-term sustainability of the sector.”