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 Daily
Independent Online.
* Wednesday, July 14, 2004.
How
World Bank misled FG on Nigeria Airways
By Rotimi Durojaiye
Aviation
Correspondent, Lagos
New facts have
emerged that the World Bank convinced the government to liquidate Nigeria
Airways Limited (NAL) last year, contrary to the story put out by Abuja
that it wound it up to head off compulsory liquidation by its creditors.
In a report to the government
in 2000, the World Bank, through one of its organs, the International Finance
Corporation (IFC), had declared NAL as technically insolvent with debts
of over $65 million (N9.1 billion).
The IFC also convinced the
government that all the three operational aircraft on NAL’s fleet in 2000
fell into the category of those to be constrained with noise abating
regulations.
Predictably, in 2002, the
government banned the use of BAC-11 aircraft manufactured by the British
Aircraft Corporation (BAC).
And the IFC persuaded Abuja
that the best option was to liquidate NAL and create a new company in its
place.
“The new company,” it
recommended, “will take over all NAL assets, such as routes, aircraft,
while the liabilities, particularly, all debts of the airline, will be
transferred to the Nigerian government,” said a source.
Based on the recommendation,
Abuja opened “the country’s sky to all as amended in the “Open Sky”
agreement signed with the United States of America. The government also
re-wrote the Bilateral Air Services Agreement (BASA) between Nigeria and
the United Kingdom, which necessitated granting the Lagos-London route a
dual designated carriers (British Airways and Virgin Atlantic) status,
simultaneously as it was searching for foreign airline as core investor”.
This arrangement was said to
have led to all European airliners (British Airways, KLM, Lufthansa,
Swiss Air, Air France, Alitalia, Sabena, Aeroflot and Balkan) plying the
Nigerian route, taking a lion share of the international market and
leaving Nigerian operators, including NAL, to struggle for the crumbs.
According to the source, the
IFC later pulled out of the deal when its recommendation generated
controversy.
Before the recommendation, the
Vision 2010 Committee set up in 1995 by late Head of State Sani Abacha
was said to have presented a 13-year blueprint on the revitalisation of
NAL.
The panel recommended that “in
13 years’ time, Nigeria should have privatised the national airline, with
Nigeria Airways equity shared amongst various interests in Nigeria and
across the globe”.
It also recommended that a modern,
profitable, privatised national airline could be created by Nigeria
before 2010 and warned that efforts to revive the aviation industry
should be concentrated on reactivating NAL.
NAL management had presented
at a workshop organised by the Ministry of Aviation in Abuja in 2000 that
it believed in the resuscitation of the airline and was prepared for its
privatisation.
NAL, under Ibrahim Jani as
Managing Director, recommended that “it would be cheaper and easier to
resuscitate Nigeria Airways than to build a new national carrier from
scratch”.
It also stressed that the
government should create an enabling environment to attract private
investors in the airline, by ascertaining and classifying its debts as
“national debts” and agreeing to pay them off.
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