Nigeria grounds national airline before take-off

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Nigeria’s government has suspended the proposed new national carrier, Nigeria Air, the country’s Minister of State for Aviation, Hadi Serika, said on Wednesday.

The former pilot and promoter of the idea, made the announcement on Wednesday through his Twitter handle.

“I regret to announce that the Federal Executive Council has taken the tough decision to suspend the National Carrier Project in the interim.

“All commitments due will be honoured.

“We thank the public for the support as always.”

Sirika did not give the reason for the Federal Executive Council action.

Sirika on July 18 unveiled the logo of the proposed airline on the sideline of the Farnborough International Air Show in UK.

The colour is green, white and green, while the logo is Eagle. Sirika said the country was finally on track to inaugurating the national flag carrier to commence operations before the end of the year.

“Following the extensive market research, the branding of our new airline, Nigeria Air, demonstrates a true flag carrier of our nation, soaring through the skies in the shape of our nation’s eagle.

“The Nigerian government will support the launch of the new flag carrier with viability gap funding, in a Public Private Partnership (PPP) arrangement to deliver a national flag carrier.

“It will be guided by the international ICAO standards, that will stand the IOSA audit from the start, and lead to a fast IATA membership for international operation,” he said.

A week after, he clarified that Nigeria would not pay $300 million for a five per cent stake in the proposed airline.

The minister said the $8 million to be provided by the federal government represented the startup capital for offices and other facilities required for takeoff.

He added that the $300 million was the entire airline cash flow funding requirements for aircraft, operations and working capital for three years 2018 to 2020.

According to him, this funding can be in the form of equity or debt.

“The financial model estimates cash flow requirements as follows: 2018 – $55 million, $8 million is included here; 2019 – $100 million and 2020 – $145 million.

“In order to ensure take-off of the airline in 2018, the government will provide $55 million upfront grant/viability gap funding to finance startup capital and pay commitment fees for aircraft to be leased for initial operations and deposit for new aircraft whose delivery will begin in 2021.

© NAN

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