How Multiple Designation Policy kills Domestic Airlines’ Operations

How Multiple Designation Policy kills Domestic Airlines’ Operations
As foreign airlines continue to gain additional entry points to destinations in Nigeria, industry analysts have said the cost and impact of such a policy on the operations of domestic airlines and the industry at large is unquantifiable and capable of stifling the growth of domestic airlines.

Currently, foreign airlines operate flights into more than one destination in the country as a result of the government’s multiple designation policy. This policy gives foreign airlines access to more than one destination (airport) including Lagos and Abuja to the detriment of indigenous airlines. With this, foreign airlines airlift passengers from airports where ordinarily domestic airlines would have had the opportunity to airlift such passengers and bring them to hub airports from where foreign airlines can take them to their destinations across the globe.

Investigations show that most of the mega carriers that operate flights into Nigeria now operate flights into more than one destination in Nigeria which negatively impact on the bottom-line of indigenous airlines who are struggling with their operations. For instance, British Airways operates flights into Lagos and Abuja, Air France KLM Group fly to Lagos, Abuja and Port Harcourt, Lufthansa German Airlines operate flights to Lagos and Abuja, Ethiopian Airlines flies into Lagos and Enugu and Abuja, while Emirates Airline and Turkish Air have access to fly to Abuja and Kano respectively as well as Lagos. Just recently, the government has given Rwanda Air permission to also operate fly into the Abuja Airport in addition to its flights to Lagos.

The issue of multiple designation policy has been on the front burner for years, with industry stakeholders kicking against this policy of government which gives foreign airlines access to more than one destination in the country.

As at today, foreign airlines dominate flight operations in Nigeria, while domestic airlines are neck deep in financial crisis, and are unable to compete with these carriers from Europe, United States of America and the Middle East.

According to statistics from the Nigerian Airspace Management Agency (NAMA) the Nigerian Airspace has continued to enjoy increased patronage from airlines.

According to statistic from the agency, released in 2013, 26 scheduled airlines that operated in the Nigerian airports recorded 28,532. Arik Air had 4,760 flights which was the highest with 17% contribution to the aggregate operations followed by Deuthsche Lufthansa with 2,481 flights and contribution of 9% to the operations. Group Air France had a total of 1,922 flights and 7% contribution; Ethiopia airlines with 1,921 flights and contributed 7% while the British Airways recorded 1,706 and contributed 6%.

NAMA also released a data of the flights for the first half of 2013 which also showed that foreign airlines are clearly dominating the airline market. NAMA recorded 15,078, which showed an 8.97% increase over same period last year which recorded 13,837 flights.

According to the statistics the best five airlines that over flew the airspace during this period include; Group Air France with 1,726 flights followed by Ethiopian Airlines with 1,290 flights while Royal Air Moroc came third with 824 flights. Emirate Airlines was the fourth with 729 flights while South African Airways came fifth with 691 flights.

Some of the industry experts who have criticized the multiple designation policy of government included, Chief Executive Officer, BeluJane Konsult Limited, Mr. Chris Aligbe. He said the policy of multi designation of foreign airlines has not helped the growth of the indigenous airlines neither has its helped government’s vision of creating a hub airport. He urged for caution in designating carriers to operate into more than one airport in Nigeria.

Also, an airline executive, who preferred not to be named described multiple designation policy as a dangerous phenomenon capable of killing the domestic airlines.

Some industry watchers often wondered why other airlines operate flights to Nigeria make money while Nigerian airlines have remained impoverished and unable to grow their operation, to which others attribute to bad policies implemented by the government which are anti industry growth like the multiple designation policy by the Nigerian government.

 

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