Aviation Fuel Hike: FG Grants Discount To Local Airlines On Outstanding Debts

The federal government has announced discount to local airlines debts as a means of addressing the over 300 per cent hike in aviation fuel, popularly known as Jet A1.

This is coming after the domestic airlines, under the name of Aviation Owners Operators Association of Nigeria (AON) had threatened to shutdown operations.

After meeting with the AON and other stakeholders, the minister of aviation and aerospace development Festus Keyamo told journalists that the president approved the discount and also promised to address the issues of taxes and levies affecting the airline operations in Nigeria.

According to him, “Before this meeting, I had the privilege of meeting Mr. President to brief him about the meeting and Mr. President mandated us to quickly bring a request to him, a formal request in writing, first thing tomorrow morning. And the first request that he will consider and grant is a generous discount on the debts the airlines are owing the aviation agencies like NAMA, FAAN, NCAA and so on and so forth.

“The percentage of discounts and all that Mr. President would decide. He is so concerned about what is happening and he asked me in particular to express his deep appreciation to the airline operators. He knows the conditions under which we operate. And he said he should thank you for not raising your prices despite all that has happened.

“The second request Mr. President has asked that we should bring for him to fully consider and grant is that he wants to set up a committee to address the issues of levies, taxes and fees on domestic tickets once and for all. This request has been on for a long time. So Mr. President will put the team together and he will give them a deadline to report to him as quickly as possible on the fees, the government fees and charges and levies that we can take off domestic tickets for now to give respite to Nigerians who are also buying tickets. And of course, he will consider a date for the airline operators to meet him one-on-one for the other more robust discussions regarding access to capital and all of that.”

Speaking on behalf of the AON, the chairman of Air Peace, Allen Onyema called for total cancellations of debts owed to aviation agencies.

He however, bareated the oil companies for increasing aviation fuel beyond 300 per cent.

According to him, “Why are we here in the first place? Because of the astronomical rise of jet oil, Jet A1 fuel in Nigeria, which we consider not to be proportionate with the cost of, or the rise in the cost of crude oil all over the world. The standard is, if crude oil rises by 10 per cent, the by-product of crude oil should rise by a proportionate rise in the pricing. But in Nigeria, after the Hormuz blockade, Nigeria increased by about 300 per cent, and these airlines are bleeding.

“We are bleeding. Yes, we threatened to shut down, not because we wanted to shut down, but because we have no money anymore to continue. We can’t continue to borrow money from the banks just to pay for fuel and neglecting other things that are supposed to be done in the industry. And you know very well that your regime pushes utmost safety, and we don’t want to shorten safety.

“So we decided that instead of not having money to do other things like maintenance, but only to be buying fuel that we needed to shut down. We appreciate this government. So when the Honorable Minister came to us to say, please don’t do this, it didn’t take us a second to obey that plea, because this government has really helped the airlines and the aviation industry more than any since 1960.

“This is a welcome development, but the truth is that the marketers must be brought to book to explain how they got about the 300 per cent increase, when even Dangote is even surprised, because what he’s selling to us still remains the cheapest, and some of them lifted from there. So why the astronomical rise?”