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High Customs duties kill ground-handling business in Nigeria—–SAHCO boss —-begs government for waivers

Eyewitness reporter
The Managing Director, Skyway Aviation Handling Company (SAHCO), a subsidiary of SIFAX Group,Mr. Basil Agboarumi, has raised serious concerns over the debilitating effects which  the high customs duties on ground-handling equipment have on the business of ground Handling companies in the country.
Agboarumi, who spoke in Lagos at the weekend, believed that for the operators of ground-handling companies to break even in Nigeria, government should give them palliatives similar to the gesture offered to airline operators in terms of duty waivers on the importation of these equipment.
He noted that, just like aircraft and aircraft parts that enjoy duty waivers are sourced in international market, ground handling equipment are similarly expensive and equally procured outside the country.
The SAHCO boss disclosed that operators of ground handling business have come together to approach government on the need to get duty waivers if they were to remain in business.
Towards this end, he revealed that they  had sent documentation and representation to the Ministry of Aviation and Nigeria Civil Aviation Authority (NCAA) in the hope that the issue can be looked at and given speedy approval and implementation.

”We felt that no matter what government is doing for the airlines, ground handling should be included and benefit from it too.

‘It is just the same way aircraft are gotten from abroad that is our own are brought in because none of our equipment is manufactured in Nigeria.

“We also place orders so that the manufacturers do them. We pay quite a lot of money to get in our handling equipment. We believe that what should be done is that same kind of waivers that the airlines are enjoying should also be extended to us to make life easier for us.

“We are taking our case to the government, Ministry of Aviation and the NCAA as the representative of government in the aviation industry.

“The last point was NCAA requesting for some information from us and some of the things that we learnt has to do with the issues have been raised in some higher places and they needed to submit data and positions.

“So we submitted our position and I believe that they have taken it from us and we are expecting a feedback from government in that regard. We believe governments should look at us.”

Agboarimi disclosed that  SAHCO spend huge sum as customs duty on most of its equipment and this could be saved and ploughed back to improve the business if waivers are granted.

“At times,  we spent as much as N36 million to clear just one equipment”  he lamented.
“It is huge. Everything we bring in. We spent N36 million to clear one of our equipment recently.
“Sometimes, you have some of our equipment that goes as much as one million dollars. We have equipment like that.

“As I talk to you, there are equipment we placed orders for since early 2020. By the time pandemic started, we still wanted to go on but we couldn’t raise funds. There was one that finished manufacturing and we couldn’t have money to pay, so they have to give it to another ground handling company.

“Sometimes, it takes about six months to produce ground handling equipment. These are some of the challenges. We fabricate those ones we have the capacity to do”

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Aviation

Emirates airline suspends operations in Nigeria over $85m trapped funds

 

Eyewitness reporter 

From September 1st, 2022, Emirates airlines will cease to operate flight operations in and out of Nigeria.

The beleaguered airline said the operational environment in Nigeria is suffocating as its $85 million is still trapped in the country.
In addition, the airline said the unavailability of foreign exchange has complicated an already bad situation.
In a press statement made available to newsmen, the airline said it will stop its operation indefinitely starting from September, 1st 2022 till after it was able to repatriate its trapped fund.

It could be recalled that Emirate airline had cut down on its weekly number of flights into Lagos from 11 to seven over US$85 million of funds awaiting repatriation from Nigeria.

The airline said the figure has been rising by more than $US10 million every month, as the ongoing operational costs of our 11 weekly flights to Lagos and 5 to Abuja continue to accumulate.

They, however, said that the trapped funds are urgently needed to meet operational costs and maintain the commercial viability of their services to Nigeria.

“We simply cannot continue to operate at the current level in the face of mounting losses, especially in the challenging post-COVID-19 climate. Emirates did try to stem the losses by proposing to pay for fuel in Nigeria in Naira, which would have at least reduced one element of our ongoing costs, however, this request was denied by the supplier,” the airline had said.

However, with no considerable improvement and headway in repatriating the trapped fund, the airline, on Thursday, announced the suspension of its operations in Nigeria indefinitely.

The statement reads, “Emirates has tried every avenue to address our ongoing challenges in repatriating funds from Nigeria, and we have made considerable efforts to initiate dialogue with the relevant authorities for their urgent intervention to help find a viable solution.

“Regrettably there has been no progress. Therefore, Emirates has taken the difficult decision to suspend all flights to and from Nigeria, effective 1st September 2022, to limit further losses and impact on our operational costs that continue to accumulate in the market.

“We sincerely regret the inconvenience caused to our customers, however, the circumstances are beyond our control at this stage. We will be working to help impacted customers make alternative travel arrangements wherever possible.”

“Should there be any positive developments in the coming days regarding Emirates’ blocked funds in Nigeria, we will of course re-evaluate our decision. We remain keen to serve Nigeria, and our operations provide much-needed connectivity for Nigerian travelers, providing access to trade and tourism opportunities to Dubai, and to our broader network of over 130 destinations.”

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Aviation

Scarcity of forex forces Air Peace to suspend flights on  South Africa route

Eyewitness reporter

Air Peace, on Monday, said it has stopped flight operations to Johannesburg, South Africa effective from August 22, 2022, due to delayed issuance of South African visas to travellers, worsening forex crunch and the increasing cost of aviation fuel as well as its scarcity.

The carrier in a statement on items official Twitter handle said the development was regretted but has become inevitable, saying the situation may improve in 60 days.

According to the airline, they have informed the South African High Commission in Lagos of the effects of the difficulty in getting SA visas by Nigerians, which consequence is the abysmally low passenger loads o flights to and from Johannesburg.

The statement read, “Passengers whose flights are affected have the option of rescheduling to fly before August 22, 2022, or from October 9, 2022. Passengers can also request a refund via callcenter@flyairpeace.com and our team will attend to it promptly.

The carrier apologised for the inconveniences caused, stressing that it would keep the public updated while it hoped the situation improves.

The sudden stoppage of operations by Nigeria’s airlines has further reinforced the precarious situation of carriers in the country and globally as airlines are extremely finding it difficult to operate profitably because of the crisis that has hit the sector, particularly on the skyrocketing prices of Jet fuel.

The foreign exchange (FX) liquidity crisis is eating deeper into the daily operations of the local airlines, causing airlines’ capacity to dwindle and hitting up airfares.

With aviation fuel at its all-time high and foreign exchange unavailable to meet obligations on schedule, local air travellers should brace up for tougher days ahead.

Operators have warned that the dire situation, now feasting on airlines’ operations, would worsen flight delays and cancellations, further reduce frequencies and routes, and push airfares higher as more carriers battle to stay afloat.

With 10 local airlines suddenly down to eight, the effects are telling on local travels. On the one hand are the stranded travellers on less viable routes. On the other are high-frequency routes that are now affected by high fares.

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Aviation

FAAN  debunks  rumours of  Lagos plane crash

—Says aircraft sold by owner

The Federal Airports Authority of Nigeria (FAAN) on Wednesday debunked viral news that a plane had crashed in the Ikeja area of Lagos State.

In a short statement posted on its verified Facebook page, the airport authority said that the plane was sold by the owner and was being transported by the new buyer.

“The Federal Airports Authority of Nigeria would like to inform the general public to disregard the news making the rounds on social media about an alleged crash at Ikeja Airport.

The aircraft was sold by the owner to a buyer, who was taking it to its final destination.”

This clarification came after a wingless plane was seen being transported on a flatbed trailer on the road at Ikeja- along bus stop axis, Lagos, causing gridlock and panic among road users.

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