Published On: Tue, Sep 6th, 2016

Cartel hiked aviation fuel to defraud Nigerians — Airlines

The Airline Operators of Nigeria (AON) has blamed scarcity and persistent increase in the price of aviation fuel on a powerful cabal.

The Chairman of the association, Captain Nogie Meggison, who made this revelation, advised the government to step in to stop and break the cartel’s hold.

“It is obvious that there is a cartel; there is something behind it. Because this is happening in a country where we were buying fuel in March, April for N105 and today, four months down the line, you are buying it at N200 per litre in Lagos only. Once you go out of Lagos and you start to move into the hinterland, it goes as high at about N240.

“It is clear that there is a cartel, or a price fixing at the detriment, sadly, of the Nigerian masses. You can go and look at the profit returns and the first quarter or half year report from the oil marketers, they are now making three times what they made last year at the detriment of Nigeria and Nigerians. I believe that the government needs to step in this time to stop and break that hold.

“It is sad and pathetic that for the past two to three months, we have been experiencing unstable fuel supply. It is really affecting us in different ways.

One of them is that it is not just epileptic, but you are not sure when you are going to fly. It is also making us delay our flights and unable to provide service for our clients.

“Almost 50 per cent of our flights are either being delayed or cancelled. You see a businessman coming to the airport for a 9 a.m. flight and departing at 4pm.

Lagos_Airport_Iwelumo-2

He also blamed the upsurge in the price of aviation fuel on the restriction on foreign exchange by the Central Bank of Nigeria (CBN).

“Yes, we have foreign exchange restriction and availability of forex to import. But when you look at the country next door that is also importing, like Accra, today with the government’s assistance, it is selling fuel at N120.

“We have no reason as a country, if we want to grow our economy, to sell fuel at N200 per litre. It is clear that aviation is a catalyst for any economy to grow. It is part of the wheel and a pivot for any economic stand.

“If you take any country as an example, once there is recession, the first yardstick you get is aviation and the government jumps in there to subsidise it so that people can continue to travel because you need to spend money to make money.

“You cannot shut the doors and tell people you cannot travel to the hinterland and expect the wheel of the Nigerian economy to move smoothly. So we need aviation to distribute the people. Without aviation, our recovery from the economic woes that we are going through would be impossible.

“But to be fair to the government, they are beginning to shift body and give us a listening ear to see how they can provide the fund for Jet A1 importation but the fear is always that the same marketers that we are talking about will take the same funds and use it to do something else.

“So we are working out modalities to see how we can get the government to provide that fund and ensure that it is used strictly for aviation.

Meggison also said that airlines are ready to pay their bills to aviation agencies if they come up with accurate figures as those being bandied about are virtually non-existent.

Meanwhile, the implementation of the zero duty policy on importation of commercial planes and spare parts into the country is being stalled because the central computer system of the Nigeria Customs Service (NCS) has not been updated, operators have confirmed.

The waiver on importation of spare parts which was announced a month ago was received with excitement by airline operators after receiving a communication from the NCS through a letter dated June 20, 2016.

The NCS’s communication to the airline operators stated: “I am directed to inform you that by virtue of the Federal Government 2013 Fiscal Policy measures, Ref No. BD.12237/S.1008/T/11 dated 15th January, 2013, all commercial aircraft and its spare parts imported for use in Nigeria shall attract import duty rate of zero per cent (0%) and zero per cent (0%) VAT respectively.”

However, almost two months after, the Customs Service is yet to implement the policy, according to our findings as two airlines which imported spare parts are still being asked to pay 10 per cent duty.

Chairman of Airline Operators of Nigeria, Captain Nogie Meggison, confirmed the development, saying the customs is now demanding for another letter before the policy would be implemented.

He said AON would continue to engage the service to fast track the implementation.

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