Domestic airlines lose N360bn to flights suspension, says AON

Domestic airlines in Nigeria have lost over N360 billion since the suspension of flight operations over COVID-19 outbreak in the country, the Airline Operators of Nigeria (AON) has disclosed.

The group representing indigenous operators said over 120 aircraft are currently parked at various airports in the country “with airlines required to pay accumulated cost on leased aircraft, staff salaries, allowances for crew, parking and maintenance fees, and recurrent training.”

The AON in a statement on Friday, however, called on the Federal Government to consider an urgent stimulus grant or palliatives for domestic airlines to cushion negative effects of post-COVID-19 and keep them afloat.

These palliatives, the AON said, should include deliberate sourcing, loans, grants, tax waivers, special forex windows and rates, reduction of airport taxes or surcharges, and waivers.”

It noted that about four weeks before domestic airlines suspended both local and international flights to support the government’s effort to curtail the virus, passenger traffic had declined drastically to about 9% leaving the domestic airlines in dire financial strait while raking avoidable cost.

”The AON unequivocally aligns with global concerns and reports which puts aviation sub-sector has the worst hit, as a result of the various containment efforts and strategies world-over coupled with the recent announcement by the International Air Transport Association (IATA) that passenger airliners could lose up to $133billion in revenues this year.

“Aviation service providers including Airports, fueling services providers, ground handling service providers, security services providers, catering services providers and many more would be badly hit this year 2020 according to IATA,” it said.

The statement added: ”With these troubling statics likely to threaten the existence of many domestic airlines in Nigeria who are still grappling with over 32 multiple charges, the AON wishes to commend the CBN for announcing a moratorium of one year on all principal repayments of intervention loans effective March 1, 2020; reducing interest rates from 9 to 5 percent per annum for one year, and creating a N50 billion targeted credit facility to cushion the impact of the virus on businesses post COVID-19.

“Air transport is a huge contributor to the GDP of Nigeria, and we are appealing to the Federal government to urgently consider the intervention to assist airlines at this difficult time.”