Airlines’ Debt Relief: CPPE Urges FG to Tackle High Operating Costs

The Centre for the Promotion of Private Enterprise (CPPE) has lauded the Federal Government’s approval of a 30 percent discount on outstanding debts owed by domestic airlines, describing the move as a welcome relief amid mounting operational costs.

In a statement issued on Sunday, the Chief Executive Officer of CPPE, Muda Yusuf, said the intervention would provide short-term respite for struggling airline operators.

He also commended the Minister of Aviation and Aerospace Development, Festus Keyamo, for his engagement with industry stakeholders, noting that such consultations have yielded positive outcomes.

However, Yusuf stressed that the debt relief does not address the fundamental structural challenges confronting the aviation sector.

According to him, multiple taxes, fees and levies imposed by key regulatory agencies — including the Nigerian Civil Aviation Authority (NCAA), Federal Airports Authority of Nigeria (FAAN), and the Nigerian Airspace Management Agency (NAMA) — remain excessively high.

He disclosed that these charges account for about 35 percent of airline revenues, a situation he described as unsustainable given the thin profit margins in the aviation industry.

“The aviation sector is too strategic to be burdened by such high cost pressures,” Yusuf said, adding that the industry plays a vital role in economic connectivity, trade facilitation, investment flows and national integration.

He further noted that Nigeria’s aviation sector continues to witness a high rate of airline failures, largely due to the harsh operating environment.

Describing the current charging framework as burdensome and fragmented, Yusuf called for a comprehensive review and rationalisation of aviation-related charges.

He listed the various fees imposed on operators to include ticket and cargo sales charges, passenger service charges, landing and parking fees, aircraft inspection charges, administrative and facility fees, boarding bridge charges, fuel-related levies, as well as import duties on aircraft and spare parts.

“A more streamlined and moderate cost structure is necessary to enhance the viability, competitiveness and resilience of domestic airlines,” he said.

Yusuf warned that excessive financial pressure on operators could also have implications for safety standards.

He therefore urged the Federal Government to go beyond debt relief measures and implement broad-based reforms aimed at creating a more sustainable operating environment for the aviation industry.

It will be recalled that domestic airlines had earlier threatened to suspend operations nationwide over the rising cost of aviation fuel before the Federal Government intervened with the debt discount policy.