The Nigerian government has threatened to shut down local airlines due to multi-billion-naira debts, according to authorities.
Diving Deeper
According to the civil aviation regulator, airlines owed the government N19 billion and $7.6 million, but refused to pay despite receiving payment from passengers. The airlines also owe NAMA more than N5 billion and FAAN more than N19 billion.
The NCAA has stated that airlines must enter into an agreement on how they would pay their debts over the next 30 days, beginning August 30, or their license will be suspended.
What’s happening
The NCAA was accused by the Airline Operators of Nigeria (AON), an umbrella organization for all Nigerian airlines, of imposing numerous levies on its members. The AON also stated that the costs, together with a lack of foreign exchange and aviation fuel, are suffocating the airlines.
The NCAA claims it imposes cost recovery charges to airlines because the majority of its revenue comes from statutory payments on plane tickets. He claims that even though customers pay the money, airlines continue to fail to remit it.
Looking Forward
The NCAA also plans to raise its fees because the Authority hasn’t raised fees in roughly 13 years, despite rising service costs. He said that aviation authorities face the same challenges as airlines because they, too, rely on forex to train and acquire vital equipment required by airlines to operate safely.