Minister clears air on suspension of National Carrier

The Federal Government has made clarifications following the suspension of the national carrier project.

The Federal government also said only N50m has so far been incurred for the national carrier project adding that it was yet to pay the money.

Contrary to claims that the project was suspended  because of investors apathy, the Minister of State for Aviation, Senator Hadi Sirika  said so many people indicated interest in the project.

He also denied claims that the Federal government paid a foriegn company the sum of $600,000 for the design of the Nigeria Air logo.

The Minister disclosed this in Abuja on Thursday at the 5th edition of Aviation Stakeholders forum.

He also said the idea that Arik and Aero be merged to establish national carrier was not tenable.

On the amount incurred so far the project, he said: “The Transaction Advisers for National Carrier coordinated the campaign and provided the additional services that included the development of the brand strategy and the media activities relating to the unveiling of the Airline.

“Due process was followed in the branding, which included obtaining ‘’No Objection’’ Certificate with Ref. No.BPP/RPT/18/VOL.1/075 from the Bureau of Public Procurement for the sum of N50,893,000.00. Payment for these services is yet to be made.

He further said: “Apart from commitment in respect of transaction advisory services,  branding and participation  at Farnborough air show, no other expenditure has been incurred on the the Nigeria Air project.

“So my dear brothers and sisters, it is not $8.8million I paid. I swear by Allah who created me, I also swear by Allah who created me that it is this amount I have shown you that we paid for all of the activity.

“No foreign company was paid $600,000 for the design of logo. If they have proof that I paid such amount of money, they should show it because it is public purse. If I did anything wrong, I would be sent to jail.

“Judges were prosecuted in this government and ministers. So ministers like me can also be prosecuted if I do wrong.

“As far as I am concerned,  you will not find me with financial misappropriation.  I am too young and too ambitious to smear my name. Honestly, such money was not spent and I don’t know where people got the figure of N1.2bn from.

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“The money is so big and it is not something I don’t have personally but in my village,  N1.2bn can do a lot.

“It can make 300 of my cousins, in laws and friends to become instant rich people. Do you know the amount of pure water company that would establish? We won’t joke with that kind of money.”

On the investors and partners who have so far indicated interest in the project, he said: “We do have partners. Those who have indicated interest in the project are IsDB, AfDB, AFREXIM,  US-EXIM, Standard Chartered Bank, Boeing, Airbus, Deutche infrastructure finance,  Qatar Airways, Ethiopian Airlines, French and US Governments, COMAC/CCECC, BOAD, China-Exim, and others.”

Sirika also said government intends to allow Nigerians to also grow their our business.

On the amount required to kick start the project and sustain it, he said: ”

Estimated funding requirement for the establishment of the project is 300 million dollars up to 2020. Initial start–up capital of 55 million dollars made up of 25 million dollars for deposit for new aircraft and 30 million dollars for working capital from June to December 2018.

“Estimated working capital for year 2019 is 100 million dollars, estimated working capital for year 2020 of 145 million dollars is to be provided by the strategic equity partners who are expected to manage the project.”

He explained that the name of the national carrier ‘’Nigeria Air‘‘ was obtained by engaging the general public through social media campaign where over 400,000 persons engaged within one week of campaign on facebook.

On the transparency of the Process, Sirika said: “The processes fully complied with the Public Procurement Act, 2007 and the ICRC Act, 2005; the aviation sector roadmap was presented to Stakeholders for inputs and buy-in at several fora; a project implementation management structure comprising inter- ministerial  Project Steering Committee and Project Delivery Team  were constituted to oversee project implementation as earlier highlighted.

“The appointment of transaction advisers followed due process culminating in Federal Executive Council approval after 13 months.”

On the importance of the national carrier, the minister said no domestic airline has evolved to fill the vacuum left by Nigeria Airways

He also stated  that only 28 out of Nigeria’s Bi-lateral Air Service Agreements (BASAs) with 83 countries are active on national carrier.

He said: “The national carrier is needed to give impetus to the emergence of Nigeria as hub for the West and Central Africa, promote reliable air transport services, support the growth of the aviation industry and domestic airlines through infrastructure expansion, traffic/routes expansion and manpower development associated with the National Carrier, create employment and compete with foreign airlines for a share of  international routes through competitive pricing thereby reducing capital flight,” Sirika said.

On the merging of Arik and Aero, he said:  “The suggestion that Aero and Arik Airlines under AMCON be merged to form a National Carrier is not tenable as national carrier would get entangled with huge indebtedness of the airlines, litigations and other encumbrances.”

To avoid accidents and boost safety and security around the airport, the Minister disclosed that Aviation security will start bearing arms in three months’ time.

The Minister of State for Aviation, Senator Hadi Sirika said the personnel would start bearing arms in three months’ time

He also hinted that the new airport terminal at the Nnamdi Azikwe International Airport would be ready for Commissioning in  four weeks.