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Nigerian aviation sector and uncertainty

Uncertainty seems to envelop Nigeria’s aviation industry and the fate of airline workers as Nigeria’s oldest airline, Aero Contractor has concluded plans to place workers on half salaries and wages occasioned by the huge effect of COVID-19 pandemic.

This is coming amid convergent views for bail out for airlines as a way of cushioning their losses. 

While the Managing Director of Aero Contractors, Capt. Ado Sanusi canvassed for bail out for the carriers, a former Managing Director of the airline, Capt. Dapo Olumide said the bailout or intervention should not be in the form of cash but assistance from government for the removal of too many taxes, charges and levies that have drained them and put at the brinks of collapse.

Olumide stated that the inability of airlines to pay March salary and that of April had nothing to do with COVID-19 pandemic.

He said many airlines were already struggling to pay salaries even before COVID-19, adding that It got nothing to do with COVID-19.

According to him, “If you do your home work, you see how many airlines were even owing salaries of January, February salaries by now. So, it has nothing to do with COVID-19. However, COVID-19 has exacerbated the problem for sure”.

Last month, many airlines struggled to pay their workers’ wages with many of them admitting that they were unsure of paying this month”s wages.

Sanusi stated that by the end of April 2020, “the minimum some staff would receive would be half salary, to assist in ameliorating these challenging times”. 

He explained the apprehension of workers and management explaining that the need to slash salaries was because Aero had not sold a single seat since the pandemic forced it to suspend operations.

This, he, reiterated has naturally affected the carrier’s revenue with the attendant apprehension amongst staff, noting that this is entirely understood by him and other Management Staff.

The airline chief was however silent on what would happen to the workers if the pandemic exceeds April, 2020 which looks likely to be.

He said management was exploring all options including seeking bailouts or loans from the Federal Government and the airline’s majority shareholders to assist with the payment of salaries should the suspension of operations exceed April, 2020.

He called on all staff to continue observing the Public Health Safety Protocols including personal hygiene and Social Distancing, adding that, “We should remain vigilant and prayerful and guard against being used by destabilizing elements to cause division in our collective resolve to save our company”.

His words, “This is our second week of suspending flight operations due to operational challenges presented by the COVID-19 pandemic. I appreciate and share our collective apprehensions of this suspension of operations.

“I hasten to add that the decision was taken largely to safe guard the safety of staff who on a daily basis had to relate with our customers and the general public. As earlier communicated through Human Resources, we are monitoring the pandemic and would return to operations as soon as the situation permits”.

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Sanusi disclosed that for the second time in the history of Aero Contractors, the COVID-19 challenge threatens the survival of the company while they were already struggling to stabilize before COVID-19 presented additional operational and financial challenges to their efforts.

The success of Aero, according to him is predicated their our collective resolve on how they surmount these challenges and emerge stronger. 

Meanwhile, Olumide who spoke   from Accra, Ghana, advocated how government can assist Nigerian carriers to survive post COVID-19 pandemic.

The former airline chief ruled out direct cash disbursement to the carriers because of track record of how similar intervention funds were mismanaged in the past.

He said rather than give airlines cash, government should help to relieve the burden on the airlines from the point of view of charges, levies and fees.

“There are too many of them. Even at the best of times, the charges were too much, too many levies, charges, fees placed on airlines’ heads for a developing country. There is a form of palliative that could help the airlines post COVID-19. They should remove all those charges, taxes, levies. Everything is making money for the government but not helping the airlines”.

“By providing this form of relief to the airline, you are not actually giving them money, you are bringing down their costs and that is how you will see the serious operators amongst them. Once you bring down their costs, the serious ones amongst them will know how to break even again in a short time’.

“So, giving the airlines cash won’t solve their problem because what will they do with the money you are giving them? It will only use them to pay the charges the government has been imposing on the, he added”

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Chukwuemeke Iwelunmo

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