Over 100 Airlines Collapse In Nigeria, Abuja Runway Cost Hits N400bn – Keyamo

More than 100 airlines have collapsed in Nigeria over the years, while the cost of the long-delayed second runway at the Nnamdi Azikiwe International Airport, Abuja, has surged from N45 billion to nearly N400 billion, Minister of Aviation and Aerospace Development, Festus Keyamo, has disclosed.

Keyamo said the figures underscored the high cost of prolonged underinvestment and delays in Nigeria’s aviation sector, even as he described Aero Contractors’ survival since 1969 as a testament to the resilience of the Nigerian aviation industry.

“Tough times don’t last, but tough people do. This is the story of Aero Contractors. From 1969, incredible, 1969, to where we are today, Aero Contractors have survived to this point,” he said.

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Speaking at the airline’s anniversary celebration, the minister said Nigeria had recorded one of the highest rates of airline mortality in Africa, with more than 100 operators going under over the years.

“The last time I called for the report from the NCAA, we had 100 airlines that have gone under in Nigeria. That is how high the mortality rate has been,” Keyamo said.

He said the fate of airlines such as Okada Air, Chanchangi Airlines and Concord Airlines illustrated Aero Contractors remain in business was worthy of celebration.

“Here we are today celebrating Aero Contractors. This is the pride of Nigeria. This is a story of the Nigerian spirit, and it is what we should all be celebrating as a country and nation,” he said.

He said the Federal Government’s aviation policies were being implemented in line with the Renewed Hope agenda of President Bola Tinubu, with emphasis on infrastructure, policy reforms, local airline development and human-capacity building.

According to him, the government is rebuilding critical airport infrastructure after decades of underinvestment, noting that the country’s major gateway airports had suffered deterioration because successive governments lacked sufficient resources to fund major infrastructure projects.

Keyamo explained that some of the major airport terminals constructed in Lagos, Abuja, Kano and Port Harcourt were financed through Chinese loans because the country could not raise adequate funds locally at the time.

“The four major airports sent out to build, started under Jonathan, or under Yar’Adua administration and the three under Buhari, which is the Chinese terminal now, in Lagos, in Abuja, in Kano and Port Harcourt were done by monies borrowed from the Chinese,” he said.

“We could not raise money to do anything in the last 50 years, because there was no money. The thing we managed to do was that we borrowed money from the Chinese, and we are paying back that money.”

The minister attributed the infrastructure funding constraints to the huge cost of petroleum and foreign exchange subsidies, arguing that substantial government revenues had previously been deployed to subsidise consumption rather than infrastructure.

“All the monies we were earning in this country, from oil, were going to subsidies. Very simple. Our major earnings from oil, when we made money, all the monies went to subsidising PMS and suppressing the Naira,” Keyamo said.

He said the removal of fuel and foreign exchange subsidies had subsequently created greater fiscal space for infrastructure investment, citing the Federal Government’s approval of $500 million for the reconstruction of the Lagos airport.

“In less than two years, after we removed subsidies, from both money and fuel, in less than two years, the President raised $500 million to rebuild the Lagos Airport. Not money borrowed, but because our liquidity rose,” he said.

Keyamo also said Nigeria’s foreign reserves had risen substantially, which, according to him, was helping to strengthen investor confidence and create the conditions for increased infrastructure investment.

“Our foreign reserve also rose from $3 billion to $56 billion now, and investors are rushing to the country because they now see the country as viable,” he said.

On the long-delayed second runway at the Nnamdi Azikiwe International Airport, Abuja, the minister said President Tinubu had approved the return of the China Civil Engineering Construction Corporation (CCECC) to commence the project.

He recalled that the project had generated controversy during the administration of former President Olusegun Obasanjo when its estimated cost was considered too high.

“Don’t forget that this controversy started during the Obasanjo tenure. I remember vividly that they said because N45 billion was too much for the second runway,” Keyamo said.

He said the failure to execute the project at the time had resulted in a massive increase in its estimated cost nearly two decades later.

“15 years or nearly 20 years later, it’s now costing us nearly N400 billion. That is the danger in delaying the building of infrastructure because the prices will go up everyday,” he said.

The minister said the government was now in a stronger position to finance major infrastructure projects because of its focus on rebuilding reserves and mobilising resources for development.

He linked the investment in aviation infrastructure to employment generation and broader economic growth, saying major construction projects were already creating thousands of jobs for Nigerians.

“Look at the number of people that would have been employed as we are building the Lagos Airport,” he said, adding that CCECC had employed more than 2,000 Nigerians daily on the project.

Keyamo further disclosed plans to develop a rail connection between Ikeja and the Lagos airport terminals, saying the proposed Red Line extension would improve connectivity to the airport.

“The President has approved and we have drawn the plan and are about to go to FEC, we want to start the Red Line now. It is from Ikeja bus stop run through GAT and MMA2, having a stop at Airport Base and continue to the new terminal, where it would stop underground,” he said.

Beyond Lagos, the minister said the government had approved a broader package of airport infrastructure projects, including reconstruction of the Kano airport runway and resurfacing of runways in Port Harcourt and Akure.

“I only talked about the Lagos airport. Within that same approval, the total amount was N1 trillion. It was only $500 million; there are other approvals – total reconstruction of Kano runway, we are resurfacing Port Harcourt, we are about to start resurfacing Akure airport runway,” he said.

He said the government was also implementing policies aimed at improving local airlines’ access to aircraft, adding that the policy had encouraged some state governments to establish or plan new airlines.

“After that, we have also concentrated on policies, which is to empower airlines to have access to aircraft. Because of policies, we have subnationals now coming up with airlines: Enugu, Bayelsa, Sokoto and Edo is about to start something,” Keyamo said.

The minister maintained that infrastructure development and policy reforms were central to the Federal Government’s strategy to strengthen the aviation industry, create employment and support wider economic growth.

“That is how the Renewed Hope agenda is affecting the aviation sector positively,” he said.