Transportation Sector - FG reaffirms commitment to economic

The federal government of Nigeria again has reiterated its commitment for  an economically viable transportation sector in Nigeria. 

The Minister of transportation Rt. Honourable Chibuike Amaechi, said this while delivering a key note address during Seminar/workshop organised by the Transportation correspondent in Abuja Tuesday. 

Amaeichi, said that positive transformation is ongoing in all division of transportation be it air, land and sea. He noted that the transformation, led to the recently concluded National Conference on Transportation held in sokoto state in charting a road map for the industry. 

Also making presentation on aviation, the Managing Director Federal airport Authority Engineer Sale Ndoma, stated that the aviation industry supports local and international business by providing the world’s rapid transportation network. Aviation holds the key to unlock the potential of Nigeria’s socio-economic development. 

Nigerian Airlines transported 15.2 million passengers and 195,230 metric tons of air cargo in 2016, connecting the world’s cities. By providing these services, the aviation industry plays an important role in enabling economic growth and providing various economic and social benefits.

 The economic footprint of the Aviation industry to the growth and development of our nation/country is critical, measured by its contribution of US $8.2million to gross domestic product (GDP) annually, and supports more than 650,800 jobs, including tourism- related employment and the tax revenues generated by the sector and its supply chain. However, the economic value created by the industry goes beyond the value captured by these measures. 

The connections made between cities and markets by the industry produce an important infrastructural asset that facilitates activities that enhance our nation’s productivity. More specifically, air transport enables foreign direct investment (FDI), business cluster development, specialization, and other spillover effects. To attract investment in the aviation industry, a government must provide enabling environment and work closely with industry players. To attract investments in the aviation sector, Government should curb the high taxes which stifle air transport growth and the development of modern and friendly airports in the country, addressing issues related to policy, civil aviation regulations, aeronautical charge regime, Establishment of National Carrier, Establishment of Maintenance, Repair and Overhaul (MRO) Facility, Development of Agro-Allied Cargo infrastructure, and the template for airport concessions. Government needs to rectify aviation policies so as to guarantee reliability and trust to contractual agreements on airport concessions and leases in other to attract the right investment and funding. Government is seen as an enabler and should create an enabling and well-regulated environment that will attract the right industrial players to invest in the aviation sector.

 Nigeria is considered to be a good investment heaven by most foreign investors, but they are, however concerned by government inconsistent policies that could trap their investments. This challenge accounts for high insurance premium underwriters put on asset financing in Nigeria as it affects aircraft leasing, terminal management and other businesses. The country’s aviation sector will do better if all these issues are properly addressed. Industrial players in the sector should form clusters that would encourage the government to take a deeper look at issues bordering on aviation financing, regulations, policy and aeronautical charges to sustain the growth of the industry. The local industry players should pool resources and skills together to attract investors and to set up aircraft maintenance centers, as this would reduce the cost of aircraft maintenance. Local industry players should also get global cooperation in terms of a strategic alliance to pull resources and expertise. With 51 percent of international tourists travelling by air, the aviation sector is critical to the tourism industry, which in turn is an important source of economic growth for many countries, particularly developing countries such as Nigeria. 

To this end, Government must create an enabling environment and policies that will encourage the development of tourism in the country as this will also attract investment in the aviation industry. Government must also address all security concerns in the country and issues bordering on airport security. Securing the airports against unlawful interference by ensuring that the right personnel and tools are deployed and security personnel are well trained. This will give some level of confidence to foreign investors that their investments will not be jeopardized due to security threats. Policy decisions must be backed by infrastructure development and a focused approach for general aviation to attract investment. Aviation infrastructure affects the image of our country as well as its aviation business.