Ebun Francis|
The minister of state for aviation, Hadi Sirika, on Thursday dismissed claims that process that lead to suspension of the establishment of Nigeria Air was due to lack of funds as the governments of the United States of America and France are interested in the establishment of the national carrier.
He also said the Both Arik and Aero contractor will not be merged with the emerging national carrier to protect it from being entangled with huge indebtedness of the airlines, litigations and other encumbrances.
Sirika who made the assertion while speaking at the 5th Aviation Stakeholders’ Forum in Abuja, said that the planned national carrier was suspended because the first Transaction Adviser, Lufthansa, that was to spell out the ownership model in the privatisation and shareholding process, failed to complete the process.
According to him, Lufthansa was replaced due to its outrageous demands that included opening an escrow account, demand for 75 per cent upfront payment, and refusal to pay tax.
The minister named the African Development Bank, Islamic Development Bank, the governments of the United States and France, among others as the new investors in Nigeria Air.
He said, “There was fake news that we suspended the process because there was no investor. That is not true. Already IDB, AfDB, AFREXIM, US-EXIM, Standard Chartered Bank, Boeing, Airbus, COMAC/CCECC, BOAD, China-Exim, Qatar Airways, Ethiopian Airlines, Deutche Infrastructure Finance, all of them, including the governments of France and US, have written us to say they are committed to this project, that they want to donate and partner.
“And you know why? It is because they want to export their markets. They want to sell their aircraft. And this is because we don’t have and we can’t produce aircraft. So their (US and France) governments have the responsibility to promote their businesses and that is why they wrote to us that they want to partner. So we have investors.”
He said the estimated funding requirement for the establishment of the project was $300m up to 2020, and an initial start-up capital of $55m made up of $25m for the deposit for new aircraft and $30m for working capital from June to December 2018.
“Estimated working capital for 2019 is $100m. Estimated working capital for 2020 of $145m to be provided by the strategic equity partners who are expected to manage the project,” Sirika said.
He added, “The suggestion that Aero and Arik airlines, which are under the control of Asset Management Corporation of Nigeria, should be merged to form a national carrier is not tenable as the national carrier would get entangled with huge indebtedness of the airlines, litigations and other encumbrances.”
Sirika further stated that the inability of the Federal Government to provide a sovereign guarantee for the procurement of 30 aircraft estimated at $300m in a staggered payment till 2020 was one of the major factors that delayed the process for the establishment of the airline.