 Welcome back. It's still the breakfast and plus TV Africa the travails of Nigeria's aviation sector over the years Especially in recent time a world documented not just about the aviation sector in Nigeria But as it affects other Aviation sectors around the world and airlines from other countries of outside Nigeria all these make up the vision sector in the country Well, one of these challenges is access to to funds the funds of foreign airlines And also aviation experts are advising the central bank of Nigeria to allow them access their fund This has been a hot topic in recent weeks on the federal government of Nigeria a Few days ago bowed to pressure from foreign airlines after a number of them raised the alarm over the federal government's inability to allow them Access their revenues in the country. This was said to be put at about $450 million which is a lot of money now central bank of Nigeria on Friday on behalf of the federal government of Nigeria released 265 million dollars to foreign airlines operating in the country for the remittance of A part of their revenues trapped in the country. That's part of that 450 a million era now last week it was reported that one of the world's biggest airlines emirates Announced it will suspend its flights to Nigeria from September 1 2022 over its stock Remittance, this is a Mounting to 95 million dollars and of course when you talk about Emirates airline, you know that this will affect Business in Nigeria That's a lot of Nigerians rely on them to move in and out of the country even expert rates also rely on Such airline to move in and out of the country Well, what's going on joining us to analyze and discuss this issue is not other than aviation Analyst and assistant secretary general of the aviation safety roundtable initiative in Lagos Lumide O'Honayo Mr. Lumide O'Honayo, thank you very much for your time This morning Thank you. Good morning. All right. And so please help us understand what what's going on What could be the reason for the federal government to not allow These foreign airlines take the monies that they have made legitimately out of the country You find that Airlines Like I said, it's not the fourth time it happened 2016 and later they paid and sometimes in the 90s too But we started about that. We don't we shouldn't be on the list of countries who in foreign airlines, they are requisites and reforms and we have Zimbabwe Venezuela Lebanon Zimbabwe Iran On this list is this where we want to be so I think What happened was it was was in the good one. They came in the Ayatollah team was here in march to see the vice president Uh, actually, let's see the president At that time it was about 293 million dollars And by June it had jumped up to over over 400 And as of today it's over 600 if you if you if you add non-ayatollah airlines and other related Amidst all companies who have to the media funds It's okay for experts to actually say that The crisis in the aviation You know sector should be blamed on the cbn. We understand that Remittances not remittances of accumulated revenue The delay of all of that is a problem But would it be okay because we'll also have if you look at internally Is setting all this operating carrier had suspended our operation And yes other issues that sub-persons have mentioned. So do you think that it's fair to say that? The aviation crisis that we're experiencing in Nigeria should be blamed solely on the central bank of Nigeria I totally disagree with that position. Um, I don't think There's anywhere the world about if the airlines come together with Policies to shun push their policy with the government even if they did the central bank with the Buckles the area I can put on the federal bank with the on the central bank. Sorry Is there one the monetary policy? I can present me As we have now by the nearest pre-force every day that you cannot The vision is not immune from the economy. So Other factors we affected a vision because most of them most of the operational costs are internal So I I have issues to the progressive policy whereby the official rate and the market is a wide margin which has allowed Sleeping with one another Very scarce that has affected not only cost of operation Does that say the cost of important fuel and increase the price of fuel? I I I I I put that blame on CBS squarely because yes, yeah, that's that's the primary Uh, responsibility to manage our monastic policy and that'll be my business. That I agree Again on the remittance of forms I also put it on the central bank because what the agreement the better agreement says that Every after every this sale and all charges all domestic charges Expansion paid by the foreign airlines the remainder The remainder revenue should be limited at the official rate Not at the black market rate because the L those tickets were sold at the iota of Official rate which was about 444 It went between 440 and 430 to 444 and it depends and before iota 50 that rate They always rise with with the central bank before they took that way so But so after all period of my current charges damage to the airline agencies Service providers the taxes Reckless attack to the federal government and all that I prevent even to even bank charges The remainder of those forms have to be remitted on daily basis Again, if you look at the cost of of remittance every Maybe the the the airlines have come I there was an agreement Let's make it monthly Maybe quarterly and you know It's an agreement and goes on with each airline and central bank on that but that to to hold down For the amount because of about about 600 million We now became the the highest debtor in the whole world because the total debtor supporting airlines What they want to buy is it is 1.6 billion There are billion dollars sorry 1.6 billion billion dollars Second we can all go And there was was was was going 600 million so we're the highest and not on them That is where I use the only That is going about two billion dollars and Airlines have stopped operating to into Venezuela and this I think this this was what those airlines saw and you know what I Make the same mistake again by allowing them to approach their community hence they made noise They tried as much as possible Let's let's get this far. They try as much as possible before they went into the option of stopping flight The first Government to Ayata Ayata was about several times The airlines emerald in particular came to Nigeria made me the cpn and the cpn promised To remit that it happens. They have sometime in june They wrote a letter taking that they agree to reduce their frequencies around because they are missed a status into Nigeria because of the inviting Uh, uh, lack of funds from the from the officers into Nigeria and even they even Wanted to pay for ambition for that we are using wanted to pay in mera the oil market attention and they have refused to accept That's why they're there mera. I said they must be paid in dollar So the center of the operation in Nigeria they would have to bring the line into the country They could not get the line in Nigeria, but that's oppression They could not get access to their money in dollars so they have to bring from their company from the head office It's quite unfortunate and uh I understand what you're saying to me and that um For every day that these airlines have their money strapped within the country Because Nigerians are paying in naira and not in us dollars as the naira is going down the value Of that money that they have trapped in this country is also diminishing So if we paid maybe uh, $500,000 $250,000 for a one-way ticket, for instance The dollar value of that 250k would have reduced by the time the money gets on your hand if it is trapped In the country and this is really scary You mean for an airline a global airline like embrace to say they're halting their flights to Nigeria is a scary situation And then for you to put Nigeria to remind us when you form as a nigeria style in the category of the likes of venezuela Um, I mean is economy not not in in in the junk status of car is not taken Um federal government being broke because this seems like a federal government trying to grasp at any money They can hold on to to to allow government function And and it's obviously therefore means that economy is is almost um A junk economy I want you to talk about the state of the economy the signs The signals that such an action of being the highest data to international airlines in the world Like you said, what does it mean? What does it pretend for Nigeria's economy as far as foreign investors are concerned as far as Nigeria's attractiveness Is concerned because when we talk about foreign investment We want them to bring their money into the country to multiply it and take it out So I want you to speak to that but also the the In in this on the same day that this information is coming out the Nigerian civil aviation authority is Hitting the head knocking the head of local domestic airlines Who are owing aviation agencies in the country about 46 billion Naira and they're saying that they will seize the licenses of these domestic A.m. Airlines or owing the the aviation agencies that money if they don't pay that money Within 30 days beginning from august 30 There's the same government that is not giving the foreign airlines their own money Is knocking local airlines for not giving them their money. So what do you say to this? Yeah, you're purple, of course, so there Let me try the For me, um When you do not meet with international trade agreement and It's not so commitment To uh, to to your national responsibility in international community because National service is an international agreement. You tend to rubbish the country. We've got a black eye Make no mistake about it even even Even in the civil aviation part of the month we've got a black eye by that action and there are consequences There are consequences. Um This international teams economic investors the myths in this course It's it's a poor bad village now So when you think you can Mr. A I want to be whose days are gone If you owe me to be it was going to pick it from businessmen, but you can't do Mr. A That's that's the the economy the economic systems are wired All over now look at what has happened now is that we we have shown that we're at credit rating was affected by that My indebtedness and I expect like you have to say You know a party Of investors coming in because who wants to come and who wants to come and put money in Nigeria and cannot take his money back When we start the public ability who wants to take that risk? And that's why even at all almost all the projects Under development of the phenomena of aviation Today is eight years now. There are about five months away But oh, sorry, there are about seven seven eight eight or nine months to the end of their training We are still not able to achieve one One of our programs not one I don't don't say where is he the airport concession? Is it in the new Niger? Korea, is it a economic company Is it the airport or that's imagine as madam repair and overall This is um complex that was supposed to build all these are not in Nigeria, but she did invest us to do that and those investors and those who were coming Sorry, oh come from outside the country Again coming coming to directly how this will affect Nigerian airlines When you go to release aircraft outside the country, this is what has happened the least risk Illustrious will be higher Conditions will be a bit serious Because nobody wants nobody wants to lose your aircraft. I'm not I'll not be sure you will get me that money And I'm waiting for the national career that's good. I want to release but this to be aircraft They will make this this position doesn't happen consider this This national car is not being pushed by government. They will make this condition. I'm talking about even to to ensure your aircraft It's in the premium You put them to the condition commission of them when we come out Or to decide if I'm coming to them We're in a situation where they think globally personnel is trained. Nobody wants this money tied down anywhere. Everybody wants this money And that's why you can see they're following from the foreign L.A I didn't mean that this letter was depleted. If Jolla was getting scoffed they didn't really allow let us have our money Let's have our money, but it could be In terms of the source behind the convention Jolla was being thrown all over the place Yes, we cannot meet him without financial responsibility We're paying you for sending money to the jerry public. We cannot pay our responsibility to those who are Who are Some people have to pay that responding to so that so some of this is affected really Like you analyzed and I said Look at the effect on airlines themselves when they come to listen when it comes to buying buying stairs abroad When it when it when it comes to show them this the conditionality The rate the rate would increase and we must to get because of the current ratings Now come into the discourse yesterday with the with the nca The nca was hard on the on the domestic airline. I am sure the government tried to use that to We're not the only one Uh, they're also wearing us I was wondering why the time need to be the period where people are I'm not putting the government for the main thing for an airline. Again, these are Nigerian airlines Before the the money the money required are in Naira Where is that in Naira this bank this airlines have accounts in Naira in Nigerian bank you can't Foreign countries like that you can't so why are we in here? Why are you allowing them to owe up to that amount when you have a bank account that you can you can garnish Then you can have an agreement to deduct from source Stop when the agencies are ready when they are ready to leave the apron Of government money bodies to commercial entity. They will get their money well, um, let's also look at you know the uh Aviation sector, I mean looking looking at the airlines locally right here Uh, there were some indications that unless the federal government at some point Take decisive step to curb the insecurity and address the crisis in the sector Economic activities across the country may worsen And you know the downtown or you know the downtown Would continue to be on the other side now one of the issues that the local airlines are face weight And if you go to uh the airports now you probably find a lot of persons I mean it's quite scanty because some persons are not you know patronizing The airlines because of the hike in price and that's due to you know the aviation feel I like you to show your thoughts on that we have airlines who have actually been You know in business for a very long time. Some of them have reduced, you know Yeah, they are transaction air flights who would probably you say you have flights like 10 reducing to seven six And what have you it's crippling on a daily basis The minute factor for the reduction in uh passenger uh passengers flying at the moment In the high again Both local and international Usually capitalized on this uh, which which is coming to an end probably by today In the travel industry, you know And during the summer most people So, uh, you don't find them and that's why you say that I just announced that that I was going to stop the Lagos, New York They will retain the Lagos Atlanta. So anybody that wants to fly to New York via Delta now would have to go through Atlanta of Here now, so I'm thinking there's just a relationship that The airlines always have a reason to cause frequency. If it is not demand boost It would have to do with Well security And people Or even The airlines are in the best position on the look up good content the engine and carriers Began to reduce not only For only infrequency. You were also reducing to a point of Destinations that we were going to due to the four crashes Without the first of the 2019 data in january. So by nine hundred nine That's what that's That's crazy Hit Carriers because we import fuel Because we import fuel From the NERA has also added more fuel added more burning fuel to to the crisis because it We would never the cost of getting The cost of operation before The price to gallop The More things to like to trust in the job because the vision program is very related That has affected the airlines and I'm talking those options of cutting their flights on some roads reducing capacity Instead of using the big icon About the smaller Money before I would With the revenue. Yeah, revenue. I have no more passengers. I can carry So To ensure the losses are reduced. I remember look at my word losses not profit Okay A little bit. We have a bit of a a connection issue with you, but can you hear me say? All right. Yeah, we have a bit of a connection issue with you But um, you can hear me. I only ask you to speak about the the way this Repatriation or remittance of funds works. Um, uh, there's something called the BASA the BASSA, which is some sort of, um, Arrangement which in which Nigeria is legally bound to allow these airlines remit their their funds in us dollars and them Just to try and understand this, you know properly because you're the expert to help us Is it the government of Nigeria who is meant to look for the u.s. Dollars to pay These these airlines or when they receive the funds Since the money goes to them directly if it does they now have to source for the dollars themselves Please just help us understand that Mr. Who know I owe you there, please Okay, so so just to understand how this works Are the airlines the ones supposed to when when they get paid and after they pay the charges and everything they need to do To the aviation agencies the government of Nigeria Um, are they the ones supposed to who are who look for the the u.s. Dollars and then they attempt to repatriate the funds Or is it a federal government of Nigeria who has to give them their money in dollars? All right. All right But it's it's a very very immersive very um Uh technical area and which I guess is attempted to help us understand, you know, because um What some experts are saying is that um They they have to take the money out in us dollars Now if they have to take it out in us dollars and then the government of Nigeria is one Meant to deeply hands into the occurrence of countries foreign exchange, you know reserve to give to them We're facing a foreign exchange crunch or scarcity, you know in the Posity of of forex in the country. So that becomes a problem. Yeah, that's not even and then and then you you wouldn't want to you Won't want to um blame the the The federal government The day you look at hard hard economic decisions that need to be taken by the government of Nigeria The agreements the country gets into which are binding But which may not necessarily be in the interests of the country at a certain point in time That's I wanted him to be able to unpack Because that's his the airspot, but it's very obvious that, you know FX is a big issue, you know for us right now foreign exchange is a major issue But if you look at the law, we understand that, you know countries would always act in your interests That's expected and so when countries of different nations come together They would always respect your own interests and so they would act take decisions that would favor, you know National and local policies that's what it is not to favor, you know international policy as it is been brought that You know prosperity global prosperity is the case because if global prosperity is the case the law states that for every other time at the end of transaction Uh finances, I mean funds should be remitted to every airline, you know, we're talking about sales right here because Uh when you know, this payment is being made there will be deduction of taxes and what is left to actually be refunded But that's not the case. So the law it's been breached here Law is not respected but if Nigeria is going to make an excuse that A, you know, it's difficult Yeah, Nigerian Spain now, I mean if you want to That's what we're saying that it's a problem So it might just be that we're acting in our own interests, but really we're breaking the law at the end of the end It's effective We hope to have maybe at some point in the future Lumide Ohonayo back But he's um an aviation analyst assistant secretary general of the aviation Safety round table initiative of journalists from Nigeria So we'll be right back at the top some more idea and plus if you have to have a guest With us in the studio on the breakfast still with us