Thursday, April 12, 2012

No going back on reversing fare imbalance, says Demuren

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The Federal Government yesterday vowed to call erring foreign  carriers  including British Airways and Virgin Atlantic Airways to order over the regional fare imbalance, which has made it impossible to access cheaper fares from Nigeria into Europe.This is also at variance with the fare structure from other countries in West Africa.
Speaking at a stakeholders’ forum in Lagos, Demuren explained that there was no going back on the issue. He said there is no reason Nigerian passengers should pay more to travel to Europe as opposed to the fare structure offered on the reservation system of the foreign carriers when booked from other countries in Africa.
He explained that such discriminatory practice by foreign carriers is part of the anti-competitive practices that foreign carriers indulged in to shortchange the Nigerian passengers. He said the Federal Government is poised to ensure that such unfavourable practices is not be allowed to continue.
He said a situation where foreign carriers only display expensive fares for Nigerian passengers leaves very much to be desired, because the available traffic from Nigeria is sufficient for the airlines to charge cheaper fares.

He insisted that NCAA would not allow Nigerian travellers to be short-changed in any form by any international carrier. He added that any form of collusion by international carriers would be discouraged by the agency.
The NCAA boss decried a situation where Nigerian travellers first travel to Ghana to board flights to Europe because of regional fare imbalance, adding that the current battle was for  Nigerians.
He said: “Nigeria will not be short-changed, we will pursue this to the end. Collusion or exploitation of Nigerians must stop, but exploration is encouraged. It is unfortunate that Nigerians now go to Ghana to fly to United Kingdom because of the regional fare imbalance. They discovered that they can spend the same money for a business ticket in Nigeria for two business class tickets in Ghana.
“We won’t allow this because we have the market advantage in the continent and one of the highest in the world. This is a battle and we stand by it. Anti-competitive practices must stop.”
 Meanwhile, the General Secretary, Airline Operators of Nigeria (AON), Capt Muhammed Joji,  yesterday put the total debts owed banks by domestic carriers at N200 billion.
He disclosed this at a stakeholders’ meeting organised by the Nigerian Civil Aviation Authority (NCAA) on the Passengers’ Statement of Rights and Airlines Obligation at the Murtala Muhammed International Airport (MMIA), Lagos.
 He said prohibitive operational costs constitute major challenges operators are grappling with.
Joji said Nigerian carriers could collaspe if the government does not address how the debt will be paid to the affected banks. 
He explained that the intervention funds facilitated by the Central Bank of Nigeria (CBN) did not provide working capital for the carriers.
He said the possibility of airlines paying this debt is doubtful, adding that with the way things are going, airlines would have to take care of their survival before they can talk about paying their debts.
Joji noted that the price of aviation fuel has skyrocketed from N170 per litre to N191 per litre, an increase that is affecting operating costs for airlines. This, he said, makes it difficult for airlines to make profit.

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