Why aviation sector under-performs in Nigeria

Nigeria’s aviation contribution to the nation’s Gross Domestic Product (GDP) is presently at 0.4 percent according to President, Sabre, an aviation global distribution network, Mr. Gbenga Olowo.
He further described aviation in the country as a grossly underperforming sector, adding that by implication, the sector will be required to grow annually at 25/30 percent, which he said is achievable.

Olowo said, “If we apply 5:20 rule to our airlines requesting them to grow fleet by 20 aircraft every five years, it means three airlines by 2020 will parade a minimum of 60 operational aircraft each, provide job for 15,000 workers and 30,000 workers with 120 aircraft by 2025 at the rate of 250 workers per aircraft. By this rule only Arik can stand alone at the moment.”

He noted that by this, airport, airspace and catalytic activities will also grow simultaneously, adding that this is the only way to rescue market share from foreign airlines, which must repatriate up to 95 percent of their income back to their home country in dollars and continued weakening of the Naira.

His words, “Truth be told, five to10 aircraft airlines as we have it today cannot be described as strong schedule players. All the existing seven operators should pool their resources together, operate under one Air Operator Certificate (AOC), harmonise their schedule and stop the stupid on-going competition among themselves, then we will be having two near strong players.”

According to Olowo, the structure of local airlines would not enable them compete favourably in the increasingly competitive global industry .

He said Nigerian airlines were performing abysmally when compared to the contributions of the aviation sector to other global economies.

Olowo said in 2013, aviation contributed over N119 billion to the Gross Domestic Product (GDP).