General News
WEF: Nigerian Aviation Beckons to Global Investors
Following Nigeria’s hosting of the World Economic Forum Africa (WEFA) perhaps, one of the country’s best kept secrets, unveiled to foreign participants was the Nigerian aviation industry.
Over the past three years, the country’s aviation industry has undergone a radical transformation that adequately prepared our airports to receive private investors both international and local.
The massive scale of infrastructural development of aviation facilities which may only be rivaled by that of China has positioned Nigeria as a true hub of aviation in sub-Saharan Africa and West Africa, in particular 22 existing airports round the country remodeled and expanded, including four international airports.
An important feature of the infrastructure upgrade is the addition of cargo handling facilities to some of these airports.
Undoubtedly, this is key if Nigeria is to compete in the global market for perishable agricultural produce which include fresh fruits and vegetables and ornamental plants and fresh flowers. Sister African counties such as South Africa,Tanzania, Cote D’ Ivoire, Zimbabwe, Kenya, Ethiopia, neighbouring Ghana and even far smaller ones as Namibia and Benin Republic were already making juicy profits from this market.
In 2010, African countries participating in this trade recorded a turnover of about N245 billion.
It is also noteworthy that the construction of five brand new international airport terminals by the Nigerian government, commenced this year, in Lagos, Abuja ,Kano, Port Harcourt and Enugu. Agreements for financing and construction worth about $5 billion were signed in Bejing last year, between the governments of Nigeria and China. Construction of these state-of-the art international airport terminals with cargo-handling facilities is being handled by the Chinese construction giant, CCEC.
Foreign cargo airlines and experienced cargo handling companies should have a good opportunity here.
For a global buyer of fresh tropical fruits and vegetables, it is now easier to take a direct flight to, for instance Enugu in the South East where he can purchase large quantities of cashew nuts and freight his cargo back home through the cargo wing of the same international airport at Enugu through which he flew into the country.
He could finish his business in three days and return to base.
In the past, he would have had to fly into Lagos or Abuja or Port Harcourt where there are international airports, before boarding another flight to Enugu.
Last Monday, only few days before the World Economic Forum opened in Abuja Wednesday, the supervising Minister for Aviation, Samuel Ortom, opened the newly constructed VIP lounge at the General Aviation Terminal in Abuja which would cater to the taste and comfort of international business leaders and executives and high ranking government officials coming to the country for the summit.
Ortom, who is also the Minister of state for Trade and Investments made it clear that the transformation plan of the present administration in terms of developing and opening up the country’s aviation sector to more investors would continue under his purview.
Last year, under Ortom’s predecessor, Princess Stella Oduah, a fresh programme to transform some Nigerians airports into economic hubs through the ‘Aerotropolis’ concept was slated for execution.
The novel ‘Aerotroprolis’ project adopted by the Ministry of Aviation is expected to attract investors to develop areas near the airport into flourishing economic and social centres with the airport at the centre.
The truly ambitious multi-billion dollar upgrade and rehabilitation of virtually all airport terminals round the country has lifted the country’s profile to a prominent position in the aviation sector on the continent.
Several foreign and local investors have already taken notice especially in the associated hospitality industry with a good number of international hotel brands opening hotels in the country in recent times.
In Ikeja, which is close to the country’s busiest international airport—the Murtala Muhammed International Airport, MMIA 1, two Best Western hotels have opened at the posh Ikeja GRA between last year and now.
Similarly, two rival Protea Hotels have arrived the same area in the same period of time.
A few other global hotel and hospitality brand names, including Radison Blue, are poised to join the market around the Murtala Mohammed International airport, where construction will commence in the coming days.
To also deepen the country’s air transport market, the Nigerian Aviation Ministry has signed a handful of Bilateral Air Services Agreement with several countries including Jordan and Israel.
These agreements have facilitated the commencement of direct flights—for the first time in decades—between Amman and Lagos and Tel Aviv and Lagos, respectively.
Interestingly, the US’ Federal Aviation Authority, FAA has only recently concluded a re-certification audit of the safety standards of country’s aviation industry that is expected to re-validate the country’s Category 1 status awarded in 2010.
That shouldn’t be a problem, according to Nigerian aviation authorities, given the giant strides taken by the government in the past three years to beef up air navigation by applying modern air traffic control equipment and technology with a mind to reversing the derisive description of the country as one’ big black hole’ in aviation terms, in previous years.
An ultra-modern TRACON equipment and technology is active round the country while several air traffic control towers at key airports round the country have been linked together.
Several international contractors including equipment suppliers and technical experts worked with the Nigerian aviation officials in the implementation of this project.
Similarly, the number of fire fighting tenders at key airports such as MMIA1 has been increased from 20 before July, 2011 to at least 46 by end of last year((2013).
Counter –terrorism screening equipment particularly the 3-in-1
(liquids, metals and explosives) have been installed in all Federal government operated airports round the country.
Late last year, in an unprecedented development, a Nigerian, Dr Bernard Aliu, was elected President of ICAO, the global UN body that regulates and monitors air transport safety round the world.
That amounted to a vote of confidence in the Nigerian aviation industry by the rest of the world, particularly, by the developed countries of the West.
There are opportunities for foreign investors to partner with Nigerian aviation agencies to provide state-of-the art access control equipment and technology at our airport terminals, passenger and cargo processing technology, business process/financial control software, among others.
There are also opportunities for foreign investors to set up duty free consumer shops at our airports, set up aircraft repair and maintenance hangers, among other facilities.
The Nigerian Aviation industry is open and ready to do business with the rest of the world, according to supervising Aviation Minister, Ortom, who has shown, in a number of ways, his determination to actualize the Aviation Roadmap, which President Goodluck Jonathan’s government instituted to enable Nigerians, reap in real time, the dividends of his transformation Agenda in the aviation Industry
Yakubu Dati is the coordinating spokesperson, Aviation Parastatals.
Nigeria Atomic Energy Commission (NAEC), has said that there are plans for Nigeria to begin to generate electricity from nuclear sources.
Mr Anthony Godwin Ekedegwa, chief executive, NAEC stated this when he recently visited Mr Umar Yusuf Girei, acting managing director, National Inland Waterways Authority (NIWA),in Abuja.
He was at NIWA’s office to solicit the support of NIWA in achieving the numerous advantages of using nuclear energy technology in the country.
According to him, the partnership of critical stakeholders in Nigeria will position the country well in developing and maintaining its nuclear power plant.
The NAEC chief said Nigeria intends to begin the generation of electricity from nuclear sources instead of fossil-based power plants and hydro-based power plants, stressing that for Nigeria to develop, there is a need for the country to diversify its energy needs.
In his remarks, Mr Girei assured NAEC of his agency’s readiness to collaborate on the advancement of a nuclear power plant in Nigeria.
He promised the full support of NAEC for the success of a nuclear power plant in the country, saying that as the organisation saddled with the responsibility of regulating and developing Nigeria Inland Waterways, his entity is strategically positioned to play a critical role in the federal government’s quest for sustainable energy through the new technology.
In a powerful call for continental solidarity, Ralph Mupita, Group CEO of MTN, has asserted that the future of the African continent depends on the dismantling of xenophobic barriers.
Speaking at the Kgalema Motlanthe Foundation (KMF) Winter Seminar, Mupita framed migration as a fundamental characteristic of the African identity, urging South Africa and other nations to embrace integration over exclusion.
He emphasised that the survival of African enterprises depends on a borderless approach to trade and talent. “The digital economy we’re fast moving to knows no borders.” Mupita declared, noting that the mindset of exclusion is an outdated relic that hinders the continent’s ability to compete globally.
He argued that for Africa to leverage the African Continental Free Trade Area (AfCFTA), the psychological barriers of xenophobia must be eradicated.
Providing a stark financial justification for this stance, Mupita highlighted MTN’s own operational reality as a blueprint for Pan-African success. “We earn about 80 to 82% of our earnings from outside South Africa,” he revealed, illustrating that the prosperity of South African-born entities is inextricably linked to their success across the rest of the continent. This figure underscores the interdependence of African economies and the danger of isolationist policies.
Mupita’s stance was strong advocating for unity: “The future of Africa will not be determined by the borders that separate us, but by the economic opportunities that connect us. Governments must set predictable policy and regulations.
Businesses will follow and allocate resources and capital. Together, we can build a continent where opportunity is more evenly shared and prosperity is more widely created.”
Analysts observing the seminar noted that Mupita’s remarks come at a critical juncture where economic volatility often fuels nationalist rhetoric. By tying the fight against xenophobia to the balance sheet, MTN is positioning Pan-Africanism beyond the moral imperative to its function as a business necessity. The CEO stressed that “Migration is part of who we are,” suggesting that the movement of people is the primary engine for the movement of capital and innovation.
Lagos Chamber of Commerce and Industry (LCCI) has urged the Federal Government and the National Pension Commission (PenCom) to suspend the proposed increase in Nigeria’s mandatory pension contribution from 18 per cent to 21 per cent, warning that the policy would raise the cost of doing business, threaten jobs and undermine enterprise sustainability at a time of mounting economic pressures.
Dr. Chinyere Almona, director general of the LCCI, said while strengthening retirement security remains an important policy objective, increasing mandatory pension contributions by three percentage points would impose additional financial burdens on businesses already grappling with high borrowing costs, persistent inflation, foreign exchange volatility, rising energy prices and multiple taxes.
According to the chamber, the proposed increase comes at a period when many businesses, particularly micro, small and medium-sized enterprises (MSMEs), are struggling to remain profitable amid Nigeria’s challenging operating environment.
The LCCI noted that Nigeria’s existing mandatory pension contribution rate of 18 per cent comprising 10 per cent by employers and 8 per cent by employees is already broadly aligned with the Organisation for Economic Co-operation and Development (OECD) average of 18.8 per cent.
It argued that raising the contribution to approximately 21 per cent would place Nigeria above several comparable economies, including the United Kingdom, where mandatory contributions stand at 8 per cent; the United States at 12.4 per cent; Kenya at 12 per cent, subject to earnings caps; and South Africa, where there is no equivalent mandatory private-sector pension contribution.
The chamber warned that implementing the proposed increase would significantly raise employment costs for employers, discourage new recruitment, constrain wage growth and place disproportionate pressure on MSMEs, which account for a substantial share of employment in Nigeria.
According to the LCCI, the higher payroll obligations could also reduce Nigeria’s competitiveness as an investment destination, encourage non-compliance with pension regulations and push more businesses into the informal sector.
“A stronger pension system cannot be built on weaker businesses,” the chamber stated, stressing that economic sustainability and business growth remain critical to expanding pension coverage over the long term.
The LCCI therefore called on the Federal Government to defer the proposal until a comprehensive Nigeria-specific actuarial and economic impact assessment is conducted to determine its implications for businesses, workers and the broader economy.
It also urged policymakers to engage in extensive consultations with organised private sector groups, labour unions and other key stakeholders before implementing any changes to the country’s pension contribution framework.
According to the chamber, the government’s immediate priority should be restoring business confidence, preserving existing jobs, encouraging investment and expanding the formal economy, which it described as the most sustainable pathway to improving retirement savings.
As an alternative to increasing contribution rates, the LCCI advised PenCom to focus on developing more innovative investment instruments capable of generating stronger returns on pension assets.
The chamber said improving investment performance would enhance contributors’ retirement savings without imposing additional financial obligations on employers and employees already facing difficult economic conditions.
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