Airlines’ trapped fund has done reputational harm to Nigeria – Bankole Bernard


Mr. Bankole Bernard is the GMD of Finchglow Travels and proprietor, Lagos Aviation Academy where aviation professionals are trained. In this interview with NewsGzaette, Bankole comments on foreign airlines’ withheld fund which he said has done reputational damage to Nigeria; the proliferation of agro-cargo airports, which, according to him, is not a bad idea if the states scrambling to build them have got their priorities right; scorecard of the minister of aviation, Mr. Hadi Sirika in eight years as well as naira scarcity/federal government’s cashless policy which has stymied the economy.

On $743 million trapped funds belonging foreign airlines

This is an unfortunate situation. We have a choice in business; if the Bilateral Air Services Agreement (BASA) says their funds as it were, once they make sales in local currency, change it to foreign currency, we should be able to fulfill that obligation because reputational damage causes a lot and it is one of the things that made an airline like Emirates and Etihad Airways to leave when we could have had more airlines coming into the market, but they don’t want their funds to be trapped. So, they will go to another market that is lucrative and this would not have been possible if we were doing proper dialogue.

If you say that you do not have funds for them at official rate as it were, if you are going to make them pay for a premium, they will sell the ticket at a premium and they will be able to repatriate their funds, but you don’t give them at the official rate and they are unable to repatriate their money. That is wrong and that is being fraudulent as a nation and it is not good for our image.

Today, the rate at which we are issuing tickets is N551 to a dollar. Is that the official rate? No, but that is the rate we are issuing tickets, which is moving closer to the black market. This means the issue of trapped funds would not have been if it had been properly managed.

The funds became trapped because we were not ready to give them at the official rate. Why didn’t you come out all these while and tell them the rate you would give the airlines so that they can sell their tickets at particular rates as long as it is official. After all, we have multiple exchange rates. So, what will make this one different? Then, there will not be issue of trapped funds and people will be able to do their business and the agony that you are putting a lot of travellers to will not be there.

So, this thing is all about applying your sense, but we have a lot of people that are not willing to think. Now that we have started to sell tickets at N551 to a dollar, I can tell you that the issue of trapped funds will move as fast as possible and it will come to zero. To fly to London now, it’s about N1 million and that is the cheapest.

The law of demand and supply is what is applicable in every business. If the supply outweighs the demand, the price would crash, but when people are threatened by the fact that their funds cannot be repatriated, the next thing they start to do is to reduce inventories so that they can make money. In the airline business, we have two ways of selling; you either sell volume or you make yield. Volume is when you have a lot of people while yield is when you sell a few, but you still make your money.

Scramble for building agro-cargo airports by state governments

To me, that is another misplacement of priority. Agro-cargo airport is a capital project. It is easier to make money and name when you embark on a capital project. None of them wants to come in and continue on any legacy project not completed by their predecessors because the people will ask you ‘what did you do?’

However, there is nothing actually wrong if they get their priority right. You cannot be in a state where all the interstate roads are bad and agro is the priority. You can not be in a state where all the schools are mushrooms and teachers’ salaries are not paid, then, agro is what is important to you. Can we get our priority right? The government needs to get their priorities right. The concept is a beautiful one, but it is about setting priority right.

Performance of the aviation industry of the current administration in about eight years

It is always easier for you to make an assessment of the government’s performance when you are on the other side of the seat. From the perspective, the minister has done his bit. Today, you and me are talking about the maintenance, repair and overhaul (MRO) facility, but was it there about eight years ago? We have seen a lot of improvements at the Nigerian College of Aviation Technology (NCAT), Zaria. Within the period, the college has acquired a lot of simulators. You can take it for granted. Also, in the last eight years, we don’t have aircraft accident to any commercial airline. It is very easy for us to take it for granted.

In that same eight years, we are talking about cargo airports across the country. Let us remember that somebody gave them approvals for that. If the government did not buy into the idea, the cargo airports won’t happen. It is always easy for us to judge people from their points of weakness. For once, let us focus on their strengths. Could the government have done better? Yes, because we want more from them.

Naira scarcity/cashless policy and effects on travel agencies

I am waiting for the figures that the Nigerian Bureau of Statistics (NBS) will release to the public. Either we like it or not, the economy nosedived and I want to see what they are going to give to us. It is clear to us that the economy is seriously nosedived. I won’t be surprised if we lost more than 50 per cent because it was as if everything got grounded. Apart from the scarcity of cash, even online financial transactions too was grounded, which prompted the governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefiele to apologise to Nigerians.

The fact remains that the government did not tell us the truth about what happened, but I do hope that one day, somebody would be bold enough to tell us the truth about what happened. That the cash was not made available, it was intentional. If cash was not working, but financial transfer was effective, the agony will not be too bad.


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