Nigeria suspends its national carrier project two months after unveiling name and logo

The Nigerian government has suspended its highly celebrated national carrier Nigeria Air which it planned to launch later this year. No reason was given for the decision.

“I regret to announce that the Federal Executive Council has taken the tough decision to suspend the National Carrier Project in the interim. All commitments due will be honoured. We thank the public for the support as always,” Aviation Minister Hadi Sirika said.

The launch of Nigeria Air was opposed by many Nigerians who claimed it was a political decision. Rightly so, Sirika said in London when the name of the planned national carrier was unveiled that it was done to fulfill “…the campaign promise made by our President, Muhammadu Buhari, in 2015″. He said the government planned to launch Nigeria Air by the end of 2018.

“We obtained the certificate of compliance from the Nigerian Infrastructure Concession Regulatory Commission (ICRC) two weeks ago and can now go into the investor search,” Sirika said in London.

Local news platform Premium Times, whose investigation and persistence led to the recent resignation of former Nigerian Finance Minister Kemi Adeosun, said the suspension of Nigeria Air happened because the Economic Management Team (EMT) did not approve it when it before it was unveiled in July. Citing presidential villa sources, the news platform reported that the recommendation of the EMT chaired by Vice President Yemi Osinbajo was that the Nigerian government should not set up a national carrier with public funds.

Ahead of the unveiling of Nigeria Air, the Nigerian government said the national carrier would need an initial of $300 million for take-off, but first a preliminary cost of $8.8 million. According to Nigeria’s Vanguard Newspaper, the plan was to start the airline with five aircraft.

“We intend to get a 30 aircraft market in 5 years. But we will begin with 5 aircraft on the day of launch. Government would step in to cover the funding gap at the onset and ease out thereafter,” the newspaper quoted an insider to have said.

While the plan was to make the carrier private sector-driven, the Nigerian government was supposed to fund takeoff.

Until Sirika’s announcement on Wednesday evening, everything seemed to be going as planned, with top entities such as Africa’s most profitable airline Ethiopian Airlines submitting tenders. However, recent increase in demand for forex by portfolio investors who are exiting en masse ahead of Nigeria’s 2019 election has put any forex-related project that does not require urgency, in doubt for the foreseeable future.

Before Nigeria Air was unveiled, former Education Minister Oby Ezekwesili was one of the Nigerians that were vocal about their disapproval of the project. She prayed that it failed for the country’s sake.

“For the sake of the country, it must fail,” she tweeted in March, adding that it was “clearly a wrong priority” and “a waste”.

The announcement of the suspension is coming barely a week after Nigerian airline Air Peace made public its order of 10 new Boeing 737 MAX 8 Airplanes as it continues its impressive growth. Many have argued that instead of starting a flag carrier from scratch, an existing, well-run private airline such as Air Peace could have been considered to be the national carrier. It is not strange for governments across the world to appoint a flag carrier from the existing airlines in their countries. Bulgaria Air, Australia’s Qantas, Belgium’s Brussels Airlines, Air Canada, LATAM Chile, Colombia’s Avianca, Czech Airlines, São Tomé and Príncipe’s STP Airways, Air Seychelles and British Airways are all privately-held companies, but they are also national carriers. In 2011, Sierra Leone adopted Nigeria’s Arik Air as its national carrier. There is no indication that this has changed.