Airlines to recapitalize
March 7th, 2007 Ogbuotobo Chuks || chuks@stockmarketnigeria.com
By Ogbuotobo Chuks
With the current wave of reforms sweeping across all sectors of the Nigerian economy,the Federal Government has declared April 30 as the deadline for airlines operating in Nigeria to comply with the new recapitalization policy or have their Air Transport Licence (ATL) revoked.
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Under the new policy, operators wishing to be issued an ATL and Airline Operating Permit (AOP) should adhere strictly capitalisation specified in the NCAA circular to the operators. Under the NCAA requirements , airlines wishing to operate domestically must meet minimum requirement of new generation aircraft not lower than B737-300 or its equivalent. The estimated capitalisation is made up of the cost of leasing of aircraft and other assets such as offices, spare parts, technical staff, among others, which translate into N500 million.
Operators wishing to operate within Africa must have at least four new generation aircraft made up of the cost of leasing aircraft and other assets translating into a total of minimum capitalisation of N1 billion.
For operators going for intercontinental operations, a minimum of two B767-300 aircraft or its equivalent with the cost of leasing aircraft and other assets which translate into N2 billion.
Other requirements include the compulsory installation of the Ground Proximity Warning System (GPWS) on the fleet of operators wishing to operate under any of the three areas.
Airline operators, according to investigations, may not meet the deadline as most of them do not have structures on the ground.
The new recapitalisation policy came into existence during the time of Mallam Isa Yuguda as minister. The recapitalisation policy was embraced by government as a way of making travel in Nigeria safe.
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