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FG, ECOWAS to Review Flight Charges

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Airlines in Nigeria
  • FG, ECOWAS to Review Flight Charges

The federal government has started series of meetings with some countries in West and Central Africa to review airport charges on Nigerian airlines.

Nigerians that operate West Coast destinations complain that they are made to pay exorbitant charges by some countries in the sub-region and insisted that there must be uniform charges for the Single African Air Transport Market (SAATM) to be successful.

This was confirmed by the Director of Consumer Protection, the Nigerian Civil Aviation Authority (NCAA), Adamu Abdullahi who said that the civil aviation authorities in the sub-region had met to review the charges.

Abdullahi, said if the charges are not reviewed downward, Nigeria may be forced to apply the principles of reciprocity in the Bilateral Air Service Agreement (BASA).

He said any country that levelled exorbitant charges on Nigerian airlines, Nigeria would reciprocate by doing same to airlines from same country.

“This issue is currently under discussion. The Director-Generals of the Civil Aviation Authority of these countries met, and the matter has been raised by the Director General of NCAA.

“This matter has been discussed and that is why our airlines are getting a better deal now. That explains why our airlines are now operating to some of those destinations, especially the West Coast countries. This means that things are looking up.

“We have the highest number of air passengers in West and Central Africa, so it is high time we reciprocated all the Bilateral Air Service Agreement (BASA) we have with these countries. What is good for the goose is good for the gander. If we don’t overcharge them here, they should not over charge us, but if they do, we are free to also over charge them,” Abdullahi said.

On his part, the Chairman and Chief Executive Officer of Air Peace, Allen Onyema, said some African countries charge Nigerian carriers outrageous taxes in order to discourage them from coming to their countries but when they come to Nigeria they are charged moderate fares.

He said that such operations to West Coast destinations would be unprofitable for Nigerian carriers if the charges are not reviewed downwards, noting that Nigeria has the highest number of passenger traffic on most of those routes.

“In Africa Nigeria seems to be too liberal; allowing all airlines from the continent to come to the country. But recently our request to go to Togo was snubbed until we threatened court action. In diplomacy there is the principle of reciprocity. So when they are harsh to us, we should also be harsh to them; in that way we would protect our own and also be respected,” Onyema said.

Another Nigerian airline operator whose airline has serviced those routes for years said that if African Union wants SAATM to work they must introduce uniform charges across the continent, the way it was done in Europe.

He said that both domestic charges and charges on regional destinations must be the same, noting that this is the only way SAATM would be successful.

“For example, Ethiopia Airlines pay almost nothing to the airports it operates in Ethiopia. For SAATM to work the airline must be paying what another airline from another African country will pay if it comes to Ethiopia.
“In Europe, charges are uniform, whether the airline belongs to that country or another country, as long as it is part of the European Union, it must pay the same charges.

Abdullahi accused ASECNA (Agency for Aerial Navigation Safety in Africa and Madagascar) of introducing discriminatory charges and charging airlines from English speaking African countries higher than those from French speaking nations in the region.

“Most of these complaints have to do with ASECNA and ASECNA is the body that has solid control over the airspace of these French speaking countries in West and Central Africa. Our own carriers keep complaining that their charges are too high and that they are discriminatory in what they charge airlines from English speaking countries and French speaking countries. While they charge the former highly; they charge the later low,” he said.

However, the African Civil Aviation Commission (AFCAC) is writing regulatory guideline for SAATM, which would determine the charges, the airlines that would benefit from the treaty and other guidelines.

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.

Economy

Nigeria, Morocco sign MOUs on Hydrocarbons, Others

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The Federal Government and the Kingdom of Morocco have signed five strategic Memoranda of Understanding that will foster Nigerian-Morocco bilateral collaboration and promote the development of hydrocarbons, agriculture, and commerce in both countries.

The Minister of State for Petroleum Resources, Chief Timipre Sylva, led the Nigerian delegation to the agreement signing ceremony on Tuesday at Marrakech, Morocco, while the Chief Executive Officer of OCP Africa, Mr Anouar Jamali, signed for the Kingdom of Morocco, according to a statement by the Nigerian Content Development and Monitoring Board.

Under the agreement between OCP, NSIA and the Nigerian National Petroleum Corporation, Nigeria will import phosphate from the Kingdom of Morocco and use it to produce blended fertiliser for the local market and export.

The statement said Nigeria would also produce ammonia and export to Morocco.

“As part of the project, the Nigerian Government plans to establish an ammonia plant at Akwa Ibom State,” it said.

The Executive Secretary of NCDMB, Mr Simbi Wabote, and the Group Managing Director of NNPC, Mallam Mele Kyari, were part of the delegation and they confirmed that their organisations would take equity in the ammonia plant when the Final Investment Decision would be taken, the statement said.

Sylva said the project would broaden economic opportunities for the two nations and improve the wellbeing of the people.

He added that the project would also positively impact agriculture, stimulate the growth of gas-based industries and lead to massive job creation.

He said the President, Major General Muhammadu Buhari (retd.), had mandated the Ministry of Petroleum Resources and it agencies and other government agencies to give maximum support for the project.

“He mandated me to ensure that at least the first phase of this project is commissioned before the expiration of his second term in office in 2023,” he added.

According to the statement, the MOUs were for the support of the second phase of the Presidential Fertiliser Initiative; Shareholders Agreement for the creation of the joint venture company to develop the multipurpose industrial platform and MOU for equity investment by the NNPC in the joint venture and support of the gas.

Other agreements are term sheet for gas sales and aggregation agreement and MOU for land acquisition and administrative facilitation to the establishment of the multipurpose industrial platform for gas sales and aggregation agreement.

The NCDMB boss described the bilateral agreement as significant to the Nigerian economy as it would accelerate Nigeria’s gas monetisation programme through establishment of the ammonia plant in the country.

The agreement would also improve Nigeria’s per capita fertiliser application through importation of phosphate derivatives from Morocco, he added.

Wabote challenged the relevant parties to focus on accelerating the FID, assuring them that the NCDMB would take equity investment for long-term sustainability of the project.

He canvassed for the setting up of a project management oversight structure to ensure project requirements and timelines are met.

“There is also need to determine manpower needs for construction and operations phase of the project and develop training programmes that will create the workforce pool from Nigeria and Morocco and design collaboration framework between research centres in Nigeria and Morocco to develop technology solutions for maintaining the ISBL and OSBL units of the Ammonia complex,” he said.

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Economy

Dangote Fertiliser Plant to Commence Shipment of Urea in March 2021

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Dangote to Sells Petrol in Naira, Plans to Commence Urea Shipment in March 2021

The Governor of the Central Bank of Nigeria, Mr. Godwin Emefiele, has said Dangote Fertiliser Plant will commence shipment of Urea in March 2021.

The CBN governor disclosed this during an inspection tour of the sites of Dangote Refinery, Petrochemicals Complex Fertiliser Plant and Subsea Gas Pipeline at Ibeju Lekki, Lagos on Saturday.

Emefiele further stated that Dangote Refinery would sell refined petroleum products in Naira when it starts production.

This he said would save the country from spending 41 percent of the nation’s foreign exchange on importation of petroleum products yearly.

Based on agreement and discussions with the Nigerian National Petroleum Corporation and the oil companies, the Dangote Refinery can buy its crude in naira, refine it, and produce it for Nigerians’ use in naira,” Mr Emefiele said.

That is the element where foreign exchange is saved for the country becomes very clear. We are also very optimistic that by refining this product here in Nigeria, all those costs associated with either demurrage from import, costs associated with freight will be totally eliminated.

Emefiele explained that this will make the price of Nigeria’s petroleum products affordable and cheaper in naira.

If we are lucky that what the refinery produces is more than we need locally you will see Nigerian businessmen buying small vessels to take them to our West African neighbours to sell to them in naira.

“This will increase our volume in naira and help to push it into the Economic Community of West African States as a currency,” Mr Emefiele said.

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Economy

UK Budget 2021: Will Sunak’s Budget Run Into Unintended Consequences?

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Rishi Sunak’s Budget will encourage higher earners to consider their “international financial options” and will drive businesses away from the UK, warns the CEO of one of the world’s largest independent financial advisory and fintech organizations.

The warning from Nigel Green, chief executive and founder of deVere Group, comes as the Chancellor delivered his 2021 Budget in the House of Commons, his second since he took on the role.

Mr Green says: “The Chancellor has got an extraordinarily difficult hand to play as he tries to stem the economic damage caused by the pandemic, support jobs and businesses and, crucially, rebuild the public finances.

“Whilst Mr Sunak is being hailed a hero for the continued and unprecedented levels of support, it should also be remembered that he is – in a stealth move – dragging more people firmly into the tax net.

“He is raising taxes under the radar.

“Yes, there is no income tax rise. However, he is freezing personal tax thresholds, meaning as incomes rise and thresholds don’t, he is able to raise money by fiscal drag.”

Earlier this week, the deVere CEO noted: “Those most impacted by this stealth move will be looking at the financial planning options available to them, including international options, in order to grow and protect their wealth.”

Rishi Sunak also confirmed that corporation tax will increase to 25% from 2023, up from the current level of 19%.

Of this tax hike, Mr Green goes on to say: “Lower corporation tax helps job and wealth-creating business to survive and thrive. It also helps attract business to move and invest in the country.

“Instead of increasing taxes, Mr Sunak should have relentlessly focussed on growth and stimulus policies for businesses.  This would have been of greater help to firms, the economy, jobs and, ultimately, the Treasury’s coffers.”

He adds: “Again, this corporation tax hike is likely to serve as a prompt for businesses to consider their overseas financial options.”

The deVere CEO concludes: “The Chancellor had to perform a tough juggling act.  But stealthily dragging more people into the tax net and raising corporation tax might have negative, unintended consequences for the Treasury’s bottom line.”

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