Wet leasing planes for National Carrier serves no useful purpose
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Wet leasing aircraft for the National Carrier will serve no useful purpose or benefit for the country.
Speaking at the sideline of the just concluded 26th Conference of the League of Airport and Aviation Correspondents,aviation expert and analist,Capt.Alex Nwuba said “There is really no benefit from wet lease when we pay for the airplanes in forex, pay for foreign crew, we don’t create any employment”
.” So this is not what we want as a national carrier. We are not addressing the challenges. This national carrier as noted holds nothing but decimate the existing domestic airline industry and that’s not the job of the Federal Ministry of Aviation.”
“Wet lease is an arrangement where the government has engaged an airline outside the country to bring airplanes and crew. So how does that solve our problem as a nation in terms of creating employment as an industry? How does that solve the problem of foreign exchange that we are already facing because we had to pay for that wet lease in foreign exchange. “
“But let’s ask some fundamental questions. The market exists. Airlines are operating in this market, they have challenge with the price of fuel, they have challenge of foreign exchange to pay suppliers. You even have the challenge of airlines that are selling tickets, hundreds of millions of dollars that cannot repatriate those funds. How will these three planes operate on the basis of wet lease.”
His option : to go to the market and sell the 51 percent for the Nigerian public through the stock exchange that would invigorate the stock exchange.
“ This will get the stakeholders’ buy-in. The average Nigerian will be able to put a few dollars that they put in MTN share and buy into the national carrier.”
He said that adopting this method will enable the national carrier have access to the money to actually buy airplanes or enter into a dry lease arrangement which is essentially a finance lease and make payment over a period of time even though in the finance industry which I work in, doing a finance lease in dollars for a domestic operations earning naira makes no sense at this age of the economic cycle that we are in.
“ Maybe we pay cash for the airplanes and bring them in, otherwise you do a lease of an airplane by N700 to a Dollar. By the end of the year, its 1000, you can’t make those lease payments. So we need to take this product to the market, get the stakeholders buy-in, create new jobs within the Nigerian economy, create new solutions, bringing in wet lease airplanes from abroad to fly domestic business makes absolutely no business sense.”
“But let’s ask some fundamental questions. The market exists. Airlines are operating in this market, they have challenge with the price of fuel, they have challenge of foreign exchange to pay suppliers. You even have the challenge of airlines that are selling tickets, hundreds of millions of dollars that cannot repatriate those funds. How will these three planes operate on the basis of wet lease.?”
