- Aviation Expert Urges Procurement Process Review
President of Topbrass Aviation, Captain Roland Iyayi, is seeking the review of procurement for aviation infrastructure to save the sector the billions of naira spent on airport and air navigation facilities.
Iyayi said the practice where bids were called for in aviation infrastructure without seeking the approval of service users was unhealthy for the utilisation of scarce resources.
In an interview in Lagos, the Topbrass boss said agencies of government should enlist airlines, concessionaires and other users in the tendering and procurement before committing huge funds into facilities that would not be needed.
Iyayi said it was only by involving stakeholders that the government could feel the impact of what projects that are priority in the sector.
He said airlines, which are the major clients of aviation agencies, including the Federal Airports Authority of Nigeria (FAAN) and the Nigerian Airspace Management Agency (NAMA), should have a role to play in choosing critical airport and air navigation facilities that the government should install at airports.
Iyayi said a situation in which agencies procure facilities without recourse to cost to recovery models was unhealthy for business and profitability of such organisations.
This, he said, explains why FAAN, and NAMA should engage airlines to prioritise projects to be installed at airports to enable them achieve a competitive bidding for the firms that would undertake the supply.
Iyayi said NAMA would not have run into the hitch it experienced in the execution of its contract with a French company, which supplied and installed the components of the Total Radar Coverage of Nigeria (TRACON) project.
He said the involvement of stakeholders would not only make procurement transparent but would save a lot of tax-payers money through transparent bidding.
Iyayi said: “Therefore, the emphasis should be on providing transparent procedures that will help in establishing effective public-private partnership procurement framework.”
He said failure to adopt global procurement procedures had resulted in high cost of fixing aviation facilities, which pushes the agencies to impose higher charges of airlines.
Flour Mills of Nigeria Repays N51.64 Billion Series 2 Commercial Paper
Flour Mills of Nigeria Plc (FMN) has successfully repaid its N51.64 billion Series 2 Commercial Paper as revealed in a statement issued by the company.
This follows the earlier repayment of its N13.33 billion Series 1 Commercial Paper in August 2023.
Both the Series 1 and Series 2 Commercial Papers, totaling N64.97 billion, were initially issued on February 22, 2023, under FMN’s N200 billion Commercial Paper Programme.
The Series 1, with a yield of 13.0%, raised N13.3 billion, while the Series 2, with a yield of 14.0%, raised N51.64 billion.
FMN had launched its N200 billion Commercial Paper Programme on February 10, 2023, reflecting the company’s strategic financial planning.
The Group Chief Finance Officer, Mr. Anders Kristiansson, expressed satisfaction with the timely and successful repayment of the Series 2 Commercial Paper.
He emphasized FMN’s commitment to financial prudence and acknowledged the confidence placed in the organization by the investing public.
Kristiansson expressed gratitude to stakeholders for their continuous support, reiterating FMN’s dedication to delivering sustainable value and upholding the highest standards of corporate governance.
In addition to the successful repayment, FMN tapped into the market for its Series 3 Commercial Paper in June 2023, with subscriptions from banks and Pension Fund Administrators, contributing 39.7% and 40.8%, respectively.
The transaction was managed by FBNQuest Merchant Bank Limited as the Lead Arranger, with ChapelHill Denham Advisory Limited, FCMB Capital Limited, and United Capital PLC serving as Joint Arrangers.
African Airlines Projected to Cut Losses to $400m in 2024, Says IATA
The International Air Transport Association (IATA) has forecasted a reduction in losses for Nigerian and other African airlines from $500 million in 2023 to $400 million in 2024.
The Switzerland-based IATA made this projection while presenting the global airline industry outlook in Geneva, Switzerland, on Wednesday.
IATA’s Director-General, Willie Walsh, shared the outlook, stating that global airlines are expected to generate approximately $964 billion in revenue in the coming year.
The report indicated that airline industry net profits are anticipated to reach $25.7 billion in 2024, reflecting a slight improvement over the projected $23.3 billion net profit for 2023.
Despite the challenges faced by the aviation industry in recent years, IATA sees the $25.7 billion net profit in 2024 as a testament to aviation’s resilience.
Walsh acknowledged the impressive speed of recovery but emphasized that the net profit margin of 2.7% remains below industry expectations.
IATA estimates that around 4.7 billion people will travel in 2024, surpassing the pre-pandemic level of 4.5 billion recorded in 2019.
However, Walsh highlighted ongoing challenges, including regulatory burdens, fragmentation, high infrastructure costs, and a supply chain populated with uncertainties.
He emphasized the need for the industry to build a resilient future, given its significant contribution to global GDP and livelihoods.
Fuel prices are expected to average $113.8 per barrel in 2024, accounting for 31% of all operating costs, totaling $281 billion.
Walsh concluded by expressing optimism about more normal growth patterns for both passenger and cargo in the post-pandemic era.
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