AMCON Boss Wants Government To Covert Arik Airline To National Carrier

The Nigerian government should convert Arik Airline to a national carrier instead of dissipating energy to set up brand new airline from the scratch, chief executive officer of the country's 'bad bank' has counseled.

Ahmed Lawan Kuru, CEO of Asset Management Corporation of Nigeria (AMCON) noted that the government would be saving cost in the face of dwindling resources available to the country.

 Kuru, who spoke on Monday while briefing the Senate committee on banking and finance, urged the National Assembly to ensure that the government leverages Arik Airline as a stepping stone towards setting up a national carrier.

He said (AMCON) having retrieved Arik from the brink of collapse and restructured and positioned it on the path of growth and profitability, it is imperative that tap into such opportunity to float a national carrier for the country.

He also urged the parliament to enact relevant legislation to reform the aviation sector, to help local airlines to grow and attract many other investors that are eying Nigeria’s huge aviation business opportunity.

The AMCON chief executive also recalled how respite came the way of Arik Airlines, which was immersed in a huge financial debt burden that threatened to permanently ground the airline.

According to him, prior to AMCON intervention, the airline, which carries about 55 percent of the load in the country, went through difficult times that were attributable to its bad corporate governance, erratic operational challenges, inability to pay staff salaries and heavy debt burden among other issues, which led to the intervention. 

If AMCON did not step in at the time it did, Arik would have gone under like many before it, Kuru said.

He said with the right support and investment, Arik has all that it takes to become a massive airline given the volume of reformative and transformational work AMCON did upon intervention in 2017. But to do that, Kuru said the National Assembly owes it a duty to reform the aviation sector by reducing the different layers of charges by different agencies, which makes it extremely difficult for airline to survive in the country.
“Arik has enough aircraft and facilities that can be used to set up a new airline. Even if the government wants to set up a national carrier to service just the domestic market, which currently has a lot of gap, it is possible with what Arik currently has. 

"Today if you want to travel to Lagos from Abuja and you did not book your ticket two or three days earlier, the chances are that you may not get a seat, which tells us that there is a serious gap. 

"To address the gap means that operators such as Slok Airlines and the likes may have to come back to Nigeria air space. But for them to come back, there needs to be a lot of aviation reforms, so that it will be attractive," Kuru said.
“There is something the National Assembly should do to help the aviation industry. Why is it that there is no airline in Nigeria that has successfully existed for 10 years? We have successful businessmen in Nigeria, which tell you that what is happening in the aviation sector is a structural problem that needs to be address and I think the National Assembly has a role to play there.”
“Aviation in Nigeria is a business that lacks good corporate governance. It is usually a one-man show kind of business and that sort of business structure has all sorts of management challenges. But having said that, the current state of the sector is not helping the operators, for instance, the fees and charges they pay to different agencies regulators are too high. 

"There are quite a lot of issues that I think when we sit down to address, we should be able to help the industry because it is very strategic to the development of the economy of Nigeria,” he stated.