Recession causes sharp drop in number of private jet owners

Posted by News Express | 10 April 2017 | 2,487 times

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•A fleet of private jets at Abuja airport before the recession.

The harsh economy, which has shrunk several businesses in the country, is also biting hard on wealthy Nigerians who hitherto flaunted their riches with the acquisition of state-of-the-art private jets or chartered aircraft for travel purposes.

A document made available to Independent from the Nigerian Civil Aviation Authority (NCAA) indicated that private and charter jets ownership has reduced by 47 percent in the past one year.

The country fell into a recession in the first half of 2016 as its finances were hit by low oil prices and declining crude output following militant attacks on pipelines in the Niger Delta region.

It is facing a currency crisis brought on by low oil prices, which has hammered its foreign reserves and created chronic dollar shortages, frustrating businesses and individuals.

Jet Reduction
The NCAA document indicated that as at 2015, there were 67 jets in the country, which were mainly foreign registered especially from South Africa, but the number reduced to just 36 in 2016, which indicated that 31 of them have been de-registered.

Independent gathered that the de-registered jets were either sold off by their owners or returned to the countries where they were leased from.

As at March 2014, a report claimed that Nigerians spent over $6.5 billion on private jets, making it one of the fastest-growing luxury jet industries in the world.

However, the 67 jets in the country are only those registered with NCAA while several others were registered in foreign countries, but, yet, are owned by wealthy Nigerians.

According to the document from the regulatory agency, the remaining 36 jets comprise 18 state-owned and 18 owned by individuals and corporate organisations.

But information are still sketchy as to those who were affected by the de-registration of their jets, but sources close to NCAA said that some who hitherto had two or three jets have reduced such to just one.

In all, there were about 150 private and chartered jets in Nigeria as at 2015, both registered with NCAA and foreign registry.

Forex Scarcity
A source also told Independent that scarcity of foreign exchange, blockage of some loopholes in the system by the current government, high maintenance cost especially availability of spare parts and skyrocketing price of Jet A1 (aviation fuel) may be responsible for the reduction in the number of private or charter jets.

Additional cost incurred by jet owners include landing, parking and handling fees like any commercial aircraft and over-flight charges for regional or international trips.

The price of aviation fuel has gone up from N105 and N110 as at December 2015 to N260 and N270 in 2017.

Reduced Patronage
It was gathered that some of the wealthy Nigerians who before now preferred to fly in private jets have reduced their costs by flying with commercial airlines.

One of the charter jet operators, who didn’t want his name in print, confirmed the reduction in number of jets in the country.

The jet operator, also confirmed that patronage of charter operators have reduced in the past one year while some of his colleagues have equally returned their leased jets to the countries they were brought from.

“Just as you know, the economy has not been buoyant in the past one year or so. Private jet business, which hitherto was booming, has reduced drastically and our hangars are no longer busy as they used to be in the past.

“Several things are responsible like cost of maintaining a jet and scarcity of forex among others, but it seems the government is already addressing the forex issue. I only hope that this would bring succour to the business.”

Corruption Fight
Capt. Dung Pam, chairman, governing board of the Nigerian Aviation Safety Initiative (NASI), in a recent interview with journalists in Lagos, said that expectedly the number of both charter and private jets registered in the country would reduce because a lot of people who owned business jets are people who have stolen from the national treasury either through politics or business connections in the system with those who were in power.

Pam explained that because the operators didn’t want the jets to be under the supervision of NCAA, a lot of them were registered outside Nigeria and not on the Nigerian registry, but they were being flown as private jet in the country.

He, however, declared that immediately President Muhammadu Buhari took over power, about 30 percent of the jets disappeared from the country’s airspace.

“The operators took them to countries where they registered them and kept them there for safe keeping. Usually, there is a criminal intent behind those private jets here because they are supposed to be for private use.

“A few jets that are private are those belonging to Theophilus Yakubu Danjuma and Aliko Dangote, but what other people who bought jets were doing were that they were using them for charter and commercial purposes.”

He disclosed that the perpetrators were hiding under a part of the regulation called Part G, that allows people bring in private jets and fly them without NCAA really carrying much oversight, adding that all they did was obtain a temporary certification from NCAA to enable them operate.

According to NCAA’s regulation on NCAR’s Part, “No person shall operate a foreign-registered aircraft in general aviation in Nigeria except in accordance with the terms and conditions of the Flight Operations Clearance Certificate (FOCC) and the Maintenance Clearance Certificate (MCC) issued by the authority and in force in respect of that aircraft.”

He said this is no longer the case now as NCAA had to step up its vigilance and surveillance because what was tolerated in the old administration is no longer feasible under the new administration.

•Text courtesy of Independent.

Source: News Express

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