MINISTER of State, Aviation, Senator Hadi Sirika has said that apart from commitments in respect of transaction advisory services, branding and participation at Farnborough Air show, no other expenditure has been incurred on the Nigeria Air Project.
He also said the reason why the Nigeria Air project was suspended was because of the extra 13 months it took for the Transaction advisers to complete the works after they took over from Lufthansa who brought in some outlandish demands to be transaction advisers.
Sirika who debunked claims from quarters that $8.8 million was expended at the Farnborough Airshow stated that it is misinformation, factual errors and insinuations are being peddled in both social and print media on the Nigeria Air Project.
The Minister, while speaking today at the 5th Aviation Stakeholders’ Forum at the Nigeria Air Force (NAF) Conference Centre, Abuja further debunked media publications stating that No foreign company was paid $600,000 for the design of the logo of Nigeria Air, the proposed National carrier, as being speculated on those quarters.
He said,”Apart from commitments in respect of transaction advisory services, branding and participation at Farnborough Air show, no other expenditure has been incurred on the Nigeria Air Project.”
According to him, due process was followed in the branding of the Nigeria Air project, which included obtaining ‘’No Objection’’ Certificate with Ref. No.BPP/RPT/18/VOL.1/075 from the Bureau of Public Procurement for the sum of N50,893,000.00. and in retaining the services of the company and Certificate of “No Objection” Ref. No. BPP / RPT/ 18/ VOL 1/095 in the sum of N40,219,769.20.
However, according to him, payment for these services is yet to be made.
He further explained that when he stated that the project was suspended and all obligations will be met, he meant the sum of N50,893,000.00 for branding and N40,219,769.20 in the company which is still pending.
The minister also explained that the Federal Ministry of Aviation’s participation at Farnborough Airshow, the minister said they needed to go to a places where there is visibility to launch the airline, as that is the purpose of airshows.
He said,”Farnborough Airshow is a bi-annual Global Aviation event, which provided a perfect opportunity to unveil the National Carrier. It created visibility and connected manufacturers, investors and financiers. It also gave opportunity to showcase all the projects in the Aviation roadmap.”
According to Sirika, for such events as the airshow, the services of a consultant was retained to arrange for the participation of the Nigerian Delegation (hiring of exhibition booth, meeting venues, obtaining relevant passes for delegates, facilitating meetings with prospective investors, logistics, souvenirs, branding materials, meals etc).
On the suspension of Nigeria Air,Sirika said Lufthansa had come in with an independent bid to become transaction adviser which is also practice but gave some conditions which included tax free holidays and an upfront payment of 75%, and for government to pay the upfront into an escrow account.
On reports that there were no investors for the project, Sirika said ” we do have partners, we do have investors. Already, IsDB, AfDB, AFREXIM, US-EXIM, Standard Chartered Bank, Boeing, Airbus, COMAC/CCECC, BOAD, China-Exim, Qatar Airways, Ethiopian Airlines, Deutche Infrastructure Finance, French and US Governments etc have indicated interest in the project. You can write direct and ask these partners so you know they are not fabricated.”
Sirika further explained that government, was not establishing the national carrier to suffocate domestic carriers, but use it as a tool to stimulate overall air passenger travel demand, develop new routes.
He said,”Contrary to the fear that the National Carrier will suffocate existing domestic carriers, it will rather benefit them and the industry at large. It will assist in stimulating overall air passenger travel demand, develop new routes, enhance infrastructure and promote manpower development.”
On the suggestion that Aero and Arik be merged and used as the new carrier Sirika said, “The suggestion that Aero and Arik Airlines which are under the control of AMCON should be merged to form a National Carrier is not tenable as the National Carrier would get entangled with huge indebtedness of the airlines, litigations and other encumbrances.”