According to data analysis by the Nigerian Bureau of Statistics, the Nigerian aviation industry contributes an estimated 0.4% to the nation's gross domestic product (GDP). However, it has the potential to contribute in excess of 5% and can support approximately 1 million jobs. Aviation experts have stated that in order for Nigeria to attain its position as a regional hub, it must effectively harness its aviation potential by connecting to more global destinations which will attract extensive investment into Nigeria's aviation industry. So how can Nigeria transform into a travel hub and how can this be achieved through the existing legislation and regulation?
The Civil Aviation Regulations were first promulgated in 2006 to provide national requirements in line with the Civil Aviation Act 2006. They also implemented standardised operational procedures, equipment and infrastructure, including safety management and training systems in line with standard and recommended practices as stated in the annexes to the Chicago Convention. However, subsequent amendments were made between 2006 and 2015 in order to bring the regulations into line with International Civil Aviation Organisation (ICAO) model regulations. The Civil Aviation Regulations were last updated in 2015 so as to incorporate the most recent ICAO amendments to the standard and recommended practices now contained in the new Section 20, in order to comply with ICAO Annex 19 on safety management (for further details please see "Civil Aviation Regulations 2015 – an overview"). The regulations make robust provisions for the safety and airworthiness of aircraft, licensing, operations at Nigerian airports and other related matters. Section 10 outlines the terms and conditions under which Nigeria should carry out its aviation safety responsibility to its citizens and ensure the safe operation, air worthiness and air crew qualifications of any foreign air operators that it allows into the Nigerian territory as mandated by the convention and the respective contracting state rules and regulations. The Civil Aviation Regulations regulate the operations of the Nigerian aviation sector and their implementation will largely determine whether Nigeria can achieve status as a travel hub.
The Nigerian aviation industry has continued to improve steadily in recent years due to the proper implementation of the Civil Aviation Regulations. Nigeria has not recorded fatal air crashes in the last five years, which many attribute to efficient regulation by the Nigerian Civil Aviation Authority (NCAA), as well as the implementation of the annexes to the NigCARs. Part 20 of the regulations covers all safety management issues. The standard and recommended practices in ICAO Annex 19 aim to assist states in managing aviation safety risks and Part 20 effectively adopts the standard and recommended practices included in Annex 19. The decision to establish Annex 19, which specifically covers safety management, was not due to a lack of safety management regulations or provisions. Rather, it was to consolidate all existing provisions under one section and further develop existing regulations. The safety management provisions from the following annexes were incorporated into Annex 19:
- Annex 1 (Personnel Licensing);
- Annex 6 (Operation of Aircraft);
- Annex 8 (Airworthiness);
- Annex 11 (Air Traffic Services);
- Annex 13 (Aircraft Accident and Incident Investigation); and
- Annex 14 (Aerodromes).
Airport and flight safety must be assured before status as a travel hub can be achieved.
The regulations have also had a positive effect on services for air travellers. The provisions of Section 19 covers passengers' rights and responsibilities and airlines' obligations to passengers. It addresses consumer protection issues, including compensation for denied boarding, flight delays and cancellations.
Section 19.5 focuses on priority boarding procedures. It stipulates that every air carrier must establish priority boarding procedures and criteria for determining which passengers will be denied boarding on an oversold flight if there is an insufficient number of volunteers. The established boarding procedure must be filed with the NCAA and be consistent with the Civil Aviation Regulations. Section 19.5.2 provides some priority boarding factors to be considered, such as:
- passengers on urgent medical trips;
- passengers with reduced mobility; and
- families (with a maximum of two adults) where at least one child is aged five years or under.
Further, Sections 19.5.3 and 19.5.4 state that where there is an insufficient number of volunteers, passengers can be denied boarding. These passengers will be entitled to compensation and assistance.
Section 19.6 provides that, in the event of a flight delay, air carriers have certain obligations including the payment of compensation, which is dependent on the amount of time that the delay subsists. For instance, Section 19.6.11 states that where a domestic air carrier reasonably expects a flight to be delayed beyond its scheduled departure time, it must provide passengers with reasons for the delay within 30 minutes of the scheduled departure time and necessary assistance, as detailed in the corresponding subsections. Where the flight is delayed beyond three hours, the affected passengers must be reimbursed in accordance with the applicable subsection of the regulations.
Nigeria is strategically located and can easily connect to Europe, the United States and Asia within hours, which attracts many travellers for business, leisure or connecting flights. It can also easily connect to various parts of Africa in a shorter timeframe than other African countries. However, in order to transform into a globally respected travel hub, the challenges facing the Nigerian aviation industry must be addressed. These include:
- poorly financed airlines;
- underused bilateral aviation safety agreements;
- a lack of incentives for private sector participation; and
- a harsh business environment, partly caused by excessive taxes on airline companies which have long stunted the sector's growth.
To promote immediate growth in the sector, the federal government has stated that the private sector must invest approximately $5 billion in Nigeria's aviation industry between now and 2018 on a short-term financing programme (during this period 12 million air travellers are projected to pass through Nigeria).
In "Aviation: Is Nigeria a Sleeping Giant", Nigerian journalist Chris Agabi referred to the financial projection which indicated that by 2018, Nigeria's aviation industry would require approximately $7 billion in investment in order to meet passenger demands. Further, in a presentation delivered at an aviation business forum by PwC titled "Putting the Nigerian Aviation Market in Context", it was stated that the Persian Gulf has transformed itself into the main hub for international air travel by taking advantage of its geographical and financial resources. The fact that Nigeria also has such geographical advantage suggests that it has the potential to become Africa's hub for international travel. However, to achieve this status, private sector involvement in airport infrastructure is highly recommended.
Globally, the privatisation of airport infrastructure is on the rise, and Nigeria's federal government recently disclosed that the Federal Executive Council has approved the concession of Murtala Muhammed International Airport and Nnamdi Azikiwe International Airport.
The focus of stakeholders has recently been more on customer experience, which is reflected in the quality and diversity of services rendered in order to generate non-aeronautic revenue. Aeronautical revenues are collected from sources such as landing charges, which are circumscribed by either regulated tariffs, contractual agreements between carriers and airports or a combination thereof. Thus, airports are now heavily reliant on the non-aeronautical side of the business as a driver of revenue growth. Non-aeronautic revenue sources include:
- concessions;
- parking and airport access;
- rental car operations; and
- land rent.
Most airport infrastructure in Nigeria is government owned and significantly underused. The presentation delivered by PwC revealed that the Lagos, Abuja and Port Harcourt airports account for 75% of passenger traffic in the country. It also revealed that in 2011 over 90% of the nation's revenue from the aviation industry was earned from the airports in Lagos and Abuja. Therefore, it seems that 20 of the 22 airports in Nigeria are largely underutilised and underproductive, a situation which must be addressed. The onus lies on the government and its institutions, particularly development banks, to put in efforts towards upgrading facilities at the country's major airports.
Airport standards and certification
The ICAO, in conjunction with the NCAA, has commenced implementation of the Africa-Indian Ocean Plan Aerodrome Certification Project for two of Nigeria's airports – Nnamdi Azikiwe Airport in Abuja and the Murtala Mohammed Airport in Lagos. These airports are believed to have been chosen due to their proximity to the nation's economic and political capitals, respectively. In addition, Nigeria has the highest volume of passenger traffic in Africa, most of which is directed through these airports. In September 2017 Nigeria's premier gateway, the Murtala Muhammed International Airport in Lagos, became the first airport in the country to be certified by the NCAA and therefore the first to be certified of the 22 managed by the Federal Airports Authority of Nigeria (FAAN).
Under Nigeria's existing aviation framework, the FAAN operates the airports and is responsible for ensuring safety at all times. Under Part 12 of the NCAA regulations, the FAAN must establish a safety management system and ensure that the airports meet the certification requirements of the relevant regulatory authorities, both local and international. A major advantage of the certification process is that it will create a more efficient environment for the stakeholders and eventually attract the desired private participation. The ongoing certification also requires that all aviation industry personnel are trained to operate the aircraft equipment and infrastructure.
Airport certification is an ICAO strategy for standardising and harmonising airport services, facilities and procedures, as well as ensuring uniformity in the safety of critical aerodrome elements irrespective of differences in ownership and management. It is also a means by which a state may demonstrate that airports within its territory consistently meet regulatory safety requirements, and that it is providing uniform conditions for safe and efficient operation of aircraft across all states as required by Article 15 of the Chicago Convention.
The certification process will be effective in addressing infrastructural inadequacies, such as:
- poorly maintained airstrips;
- deficient airport lighting;
- inadequate fire tenders;
- standard instrument landing systems;
- fuelling; and
- baggage handling.
If properly implemented, the ICAO certification process will give confidence to investors and service providers, as well as tourists and business travellers. This will affect the aviation sector's contribution to the nation's GDP significantly.
Nigeria has been attempting to migrate from terrestrial air navigation to a satellite-based navigation system known as Performance Based Navigation (PBN). This received a boost when two foreign airlines performed a test flight with the new approach procedures, with both pilots landing successfully at Lagos and Kano airports, respectively. Emirates Airlines was the first to carry out the test approach on the Global Navigation Satellite System (GNSS) in Lagos and KLM did so in Kano.
The PBN will save money for airlines as it means that, among other things, there will be a reduction in:
- fuel used during take-off and landing;
- carbon dioxide emissions; and
- air traffic controller workloads.
Consequently, the Nigerian Airspace Management Agency (NAMA) is scheduled to train approximately 250 air traffic controllers to use the PBN system. In 2007 the ICAO endorsed the implementation of PBN in its Assembly Resolution 36/33 for all member states, including Nigeria. The NCAA and the NAMA also worked together with the Boeing Company and International Air Transport Association respectively to achieve the implementation of PBN in Nigeria.
Nigeria's recent achievements and Level 3 rating in the state safety programme implementation process (tracked by ICAO through its Integrated Safety Trend Analysis and Reporting System), as well as its similar rating by the United States and the United Kingdom, have positioned the country to become a travel hub. However, the inherent challenges facing the industry must be addressed before this status can be achieved.
The government has expressed its desire to achieve a Level 4 rating by the end of 2017 to further assure investors and potential tourists of their safety when flying into and within Nigeria. The ICAO certification will undoubtedly help in this regard and may also attract other airlines to the country, leading to growth in the sector, provided that other social, economic and political challenges are addressed.
Therefore, it has become critical for regulators to adopt effective financing models, foreign exchange policies and stringent compliance and enforcement mechanisms in order to drive the aviation industry to its maximum potential. The government must offer incentives to attract private investment, as this is the catalyst for positive growth in the sector. With the significant benefits that the aviation sector presents to the economy, it is expected to receive more attention from the government in the near future by way of:
- direct financing;
- private sector participation;
- addressing issues relating to air navigation safety;
- airport security;
- infrastructure development; and
- capacity building.
For further information on this topic please contact David Muzan at George Etomi & Partners by telephone (+234 1 462 1660) or email ([email protected]). The George Etomi & Partners website can be accessed at www.geplaw.com.
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