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Billions Lost to Helicopter Ban on Kaduna-Abuja Route

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  • Billions Lost to Helicopter Ban on Kaduna-Abuja Route

The Federal Government’s ban on helicopter services on the Kaduna-Abuja route yesterday threw the aviation sector into disarray as investors and operators began to count losses.

The losses, running into billions as at yesterday, were due to several helicopters idling away in Lagos and Abuja while air operators failed in their commitments to passengers that had booked on both shuttle and charter services.

Foreign investors and their local partners who have invested millions of dollars and deployed for the botched services are currently considering immediate withdrawal of their helicopters from Nigeria.

According to industry sources, the development may precipitate the end of quality investment in helicopter services and contributions of the aviation sector to the troubled economy at large. As long as the ban stays while the closure of the Nnamdi Azikiwe International Airport (NAIA) lasts, the government may have made access to the seat of government (Abuja) by the rest of the world much more difficult.

Helicopter service operators in the country had expected and prepared for a boom time on account of the temporary closure of the NAIA for its runway’s repair.

The operators had deployed both charter and shuttle service helicopters for different categories of people on various routes (Lagos, Kaduna, Port Harcourt, Minna) inwards Abuja.

The Guardian last week reported that the costs of the shuttle services ranged from N100,000 to N200,000 per head, depending on the boarding location and time of booking.

A direct helicopter shuttle service from Lagos to Abuja went for between N150,000 to N200,000 per head. A similar flight on Kaduna-Abuja or Minna-Abuja route cost between N50,000 and N100,000.

The market was living up to investors’ expectations when the Federal Government issued a memo, imposing the ban on chopper services in and around Abuja airport.

Sources yesterday confirmed that none of the operators has been able to carry out scheduled services since Friday, when President Muhammadu Buhari flew in from London after his medical holiday.

The chief executive officer of one of the airlines was moved to tears when he said: “This is not what we planned for at all. They have just ruined business for all of us. Helicopters worth $20 million are just sitting down doing nothing, while operators continue to incur the cost of parking, crew and maintenance.

“What kind of country is this? And what manner of leaders are we having? If you don’t call this a devilish act, then I don’t know what else to call it.”

It was learnt that the airline of our informant has been cancelling scheduled flights, both shuttle and chartered, and refunding money to customers who paid up front.

Another operator described the ban as overzealousness on the part of government “that is just bent on scaring investors away while mouthing their invitation to Nigeria.”

The operators have been in talks with the Federal Government to reverse the order, but with little response yet from the authorities.

The National Security Adviser (NSA), Babagana Munguno, on Sunday banned chopper services in and around Abuja citing security concerns.

The NSA gave a directive banning helicopter shuttle services on the Abuja- Kaduna route through a memo in which he said, “In view of the closure of the airport, air travelers will be required to travel by road/train to Abuja from Kaduna International Airport. This will undoubtedly cause constraints on the movement of some passengers who will aim to travel using other means, notably the use of commercial ferry helicopters.

“Please be reminded that the airspace over the Federal Capital Territory Abuja is controlled and only security flights or those with the requisite security clearance from the presidency are granted overhead clearance for obvious security reasons.

“Consequently, you are to note and ensure that no charter or commercial helicopter ferry flights are allowed to fly within Abuja airspace.”

The Chairman of the Aviation Round Table (ART), the think-tank group of the aviation industry in Nigeria, Gbanga Olowo, said the ban was another classic case of how government’s policy flip-flops and harsh environment have consistently ruined air travel business in Nigeria.

According to Olowo, the poor state of the industry is 70 per cent fault of the government and the remaining, that of the operators.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Brands

Eat’N’Go Expands To East Africa, Projects 180 Stores By Year End

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In a bid to further extend its tentacles beyond the West African market, Eat’N’Go limited, one of the leading Quick Service Restaurant (QSR) operators in Nigeria and master franchisee for world-class food brands – Domino’s Pizza, Cold Stone Creamery, and Pinkberry Gourmet Frozen Yoghurt, announced its expansion into the East African market.

This development comes after the successful acquisition of the franchisee which operated Cold Stone Creamery and Domino’s Pizza in Kenya. This acquisition will see Eat’N’Go limited become the largest Domino’s pizza and Cold Stone Creamery Master Franchisee in Africa with operations in Nigeria and Kenya.

Since its entrance to Nigeria in 2012, the QSR company has grown exponentially and has continuously nurtured the drive to extend its footprint across the African market. This acquisition provides them their first foreign market expansion, making them a Pan African company with a total number of 147 outlets across Africa and a projection to reach 180 stores by end of 2021.

Group Chief Executive Officer and Managing Director Eat’N’Go Limited, Patrick McMichael said that expanding into East Africa represents a very exciting time in the growth of the organization and also a strategic investment for the firm and its stakeholders. “Over the years, we have fostered the mission to not just bring the best QSR brands to Africa, but to directly impact on Africa’s economy and we are glad we are finally on the way to making this happen. Studying the growth of the Kenyan market in the last couple of years, we are convinced that now is the time to extend our footprint into the country.”

“We are very thrilled about this expansion as this move avails us more opportunity to provide Jobs to more Africans, especially in times like this. We remain thankful to all our customers, partners, and stakeholders who have supported us this far and we are more than ready to strengthen our dedication in satisfying the needs of our customers” Patrick added.

Eat’N’Go has over the years maintained its position as the leading food franchisee in Nigeria. As it expands its presence to other parts of Africa, the organization also places a strong focus on the quality of its products and services of all its three brands. The expansion to this new region is in line with the company’s plan to reach 180 stores across Africa by the end of 2021.

The milestone achievement and development will better position the company in its contribution to Nigeria and Africa’s economy. Currently home to over 3000 staff members across Africa, the company is committed to continuously provide job and business opportunities across the continent.

Eat’N’Go launched in 2012 in Nigeria with the vision to become the premier food operator in Africa. Today, the company has over 147 stores in Nigeria and Kenya and it continues to deliver on this promise by successfully rolling out the globally recognised brands Cold Stone Creamery and Domino’s Pizza across Africa. The company continues to expand its presence in key markets by fusing company goals with new strategic development goals and is projected to reach 180 stores across Africa by end of 2021.

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Brands

Shoprite Exit: LCCI Explains Challenges Hurting Business Operations in Nigeria

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Following the recent announcement of Shoprite, a leading South Africa retail giant, that it is leaving the Nigerian market due to harsh business environment and tough business policies, Dr Muda Yusuf, the Director-General, Lagos Chamber of Commerce and Industry (LCCI) has explained some of the challenges responsible for such decision despite Nigeria’s huge population size.

Yusuf said while such decision is negative for the Nigerian economy, several factors like harsh business environment could have forced the company to make such decision. He said it also could be due to intense competitive pressure.

He said, “Shoprite is an international brand with presence in 14 African countries and about 3,000 stores. The comparative analysis of returns on investment in these countries may have informed the decision to exit the Nigeria market.

“The opportunities for retail business in Nigeria is immense. But the competition in the sector is also very intense.

“There are departmental stores in practically every neighbourhood in our urban centres around the country. There is also a strong informal sector presence in the retail sector. It is a very competitive space.”

According to the Director-General, there are also important investment climate issues that constitute downside risks to big stores like Shoprite.

He said, “These include the trade policy environment, which imposes strict restrictions on imports; the regulatory environment, which is characterised by a multitude of regulators making endless demands.

“There is also the foreign exchange policy, which has made imports and remittances difficult for foreign investors. There are challenges of infrastructure which put pressures on costs and erodes profit margins.”

The LCCI boss added, “But we need to stress that Shoprite is only divesting and selling its shares; Shoprite as a brand will remain. I am sure there are many investors who will be quite delighted to take over the shares.

“It should be noted that there are other South African firms in Nigeria doing good business. We have MTN, Multichoice, Stanbic IBTC, and Standard Chartered Bank, among others. Some of them are making more money in Nigeria than in South Africa.”

He added that some sectors are more vulnerable to the challenges of the business environment than others.

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Appointments

Afrinvest Appoints Mrs. Onaghinon As COO

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Afrinvest West Africa Limited, has appointed the former head of public private partnership agency of the Edo State, Mrs Onoise Onaghinon as its chief operating officer.

Onaghinon joined Afrinvest in 2003 as an analyst in the firm’s investment banking division, rising through the ranks to become an associate, then vice president and eventually executive director & head of investment banking.

She is a seasoned veteran in the Nigerian capital markets and investment landscape with over 18 years of experience in capital raising, mergers and acquisitions, and restructurings across many industries.

In 2017, Onaghinon took a sabbatical from the Firm to head the Public Private Partnership Agency of the Edo State Government. Having acquitted herself creditably in the public sector, she has rejoined the Firm to resume as the new COO.

Speaking on the appointment, group managing director of Afrinvest, Ike Chioke, said: “over the years, Onaghinon has demonstrated great leadership, professional excellence and outstanding client commitment in driving the firm’s business units, particularly our investment banking division. We are delighted to have her back and we look forward to leveraging her cross-disciplinary experience across the Afrinvest group”.

In her new role, Onaghinon will oversee human resources, legal & compliance, internal control and general services while leading the firm’s initiatives to improve efficiency across its subsidiaries.

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