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Business News of Thursday, 25 November 2021


Air Nigeria to take off April 2022

Nigeria Air Nigeria Air

Nigeria’s national airliner, Nigeria Air, is expected to take off by April 2022.

Minister of Aviation, Senator Hadi Sirika, made the disclosure while briefing State House Correspondents after the Federal Executive Council (FEC) meeting, presided over by President Muhammadu Buhari, at the Presidential Villa, Abuja, yesterday.

According to Sirika, the national carrier would be run by a company in which the Nigerian government will hold a 5 per cent stake, Nigerian entrepreneurs holding 46 per cent, while the remaining 49 per cent would be reserved for yet to be assigned strategic equity partners, including foreign investors.

The minister, who said FEC gave approvals for the new national carrier, said the national carrier, when operational, would create about 70,000 jobs.

Sirika recalled that over 400,000 Nigerians participated in choosing the name which was launched in 2018.

“The contract was given to Messrs Arif Investment Nigeria Limited, who are representatives of Empik GmbH. This Empik are the creators of this software, one of its kind in the world, at the sum of N1,492,520,325, which will be including 7.5% VAT and a completion period of six months. So that’s the first memoranda.

“The next one also is approval of the outline business case for the establishment of the national carrier and this is the sixth time the memorandum appeared before Council. The sixth time, we got lucky to be passed by council.

“The structure of the proposed airline; government will be owning not more than 5 per cent. So, 5 per cent is the maximum equity that government will take, then 46 per cent will be owned by Nigerian entrepreneurs. So, if you add that, it’s 51 per cent. So, it’s 51 per cent majority shareholding by Nigerians and then 49 per cent will be held by strategic equity partner or partners that will be sourced during the procurement phase, which is the next phase.

“This airline, if started, and within the first few years will generate about 70,000 jobs. These 70,000 jobs are higher than the total number of civil servants that we have in the country. Its importance had been well discussed so, I’ll not go back to it. You had discussed it separately also on various fora as to the need for it.

“But one important item is the AU agenda 2063, which speaks to integration of Africa, which speaks to the cause and trade within Africa that is intra-Africa and to which also another flagship project of AU agenda 2063 called the Single African Air Transport Market (SAATM). Now, the only way, the quickest way that you can integrate Africa is by air because if you want to interconnect all the 54 nations of Africa, via rail or road, or waterways, which is even impossible, the quantum of money that you need to do all of these, the time it will take to develop this infrastructure, as well as the maintenance cost, is almost prohibitive.”

Also, briefing, Minister of Finance, Budget and National Planning, Zainab Ahmed, said with Nigerian National Petroleum Company (NNPC) remitting almost zero to the federation account, the government can no longer sustain petroleum subsidy cost which currently stands at about N250 billion monthly.

“So if you take 250 billion times 12 months, that is about N3 trillion. If we don’t remove that, that is what it is costing us. This is money that we can use to apply to health and to education. The intervention we want to provide, it’s for between 20 to 40 million people and there is still a lot of work going on. We have a  committee that is chaired by His Excellency the Vice President, state governors and a  few of us ministers as members. So we have to have a landing as to the exact number between 20 to 40 million. We already agreed it will be N5,000 and we have also agreed that the remittances have to be done digitally. So the e-naria will help, but also so are the various payment platforms that are currently available. What we will not do is paying people in cash. So the transfers that people will receive through one kind of electronic money or the other and it’s meant to be for a period of six, nine or 12 months. So, these are things that we are still in the negotiation because it’s still money that would have to come from the Federation account. So everybody that is a member of FAAC will have to agree on the numbers. The maximum will be 12 months, the minimum will be six months.”

Ahmed also noted that the impact of the economic growth being recorded will not be felt until it surpasses the population growth rate.

She said she briefed that council on the third-quarter GDP report for 2021 which was released on Thursday last week by the National Bureau of Statistics, affirmed that the result shows an improvement from the contraction that we witnessed in 2020.