Mixed reactions trail signing of CTC Practice Direction

THE new Cape Town Convention (CTC) Practice Direction issued by the Chief Judge of the Federal High Court to eliminate judicial impediments in the implementation and compliance with the Cape Town Convention has continued to elicit reactions from key players in the sector.

The move, announced at a Presidential Enabling Business Environment Council (PEBEC) meeting presided over by Vice-President Kashim Shettima last week aimed to address years of legal barriers that had made aircraft leasing more difficult for Nigeria’s domestic carrier.

The Cape Town Convention, which was domesticated during the tenure of former Director General of the Nigeria Civil Aviation Authority (NCAA), Dr Harold Demuren, to allow Nigerian airlines like their counterparts elsewhere access aircraft leasing easy, had issues following the default of some airlines which forced the aircraft leasing companies to blacklist the Nigerian carriers.

The blacklisting, which took its negative tolls on the Nigerian carriers, led to restricted financing options for the airlines and the subsequent high insurance premiums for them.

The latest issuance of the new directives is expected to among others remove these judicial impediments, restoring access to cheaper leasing options and facilitating smoother aircraft acquisitions and equally provide much-needed relief to the aviation sector, which in turn will contribute to job creation and the broader growth of Nigeria’s economy.

The development has continued to generate reactions with some key players describing it as welcome development while others have argued that the move will not solve all the problems confronting the local carriers.

Speaking on the development, the Managing Director of Centurion Security, Group Captain John Ojikutu, retd, believes the signing of the Cape Town Convention would have been better if Nigeria had a national carrier as against the private carriers presently dominating the country’s space.

In his remarks, Ojikutu declared “It would have been better signed if we have a National Carrier or Flag Carriers. Signing such Practices now for private airlines that are not designated as national flag carriers when most of them have enjoyed similar national practices in past and have defaulted.

“I can see a repeat of what the Presidency has just experienced with the Chinese as a default of Ogun State government in a contract between the two. Some of these airlines are still under AMCON receivership because of financial defaults to foreign financial institutions and local banks. Rather than signing such conventional practice on national or Flag Carriers that would be competing with over 30 foreign airlines flying multiple frequencies into the country without significant reciprocity, we are committing our government into credit loans for private enterprises and not to public enterprises nor to the PPPs. God save us.”

For the Chief Executive Officer of Santos Aviation, MrSegunAdesanya, Nigeria has a lot to benefit from the Cape Town Convention.

“Cape Town Convention is a policy that’s presently adopted by many countries including USA, Russia to name a few. It’s basically to guarantee the lessor of aircraft engine, airframe etc. I think Nigeria can benefit from it as South Africa is not too far away from Nigeria and both countries can relay to each other amicably.

Reacting to the signing of the Cape Town Convention Practice Direction on Arise Morning Show programme, the Vice President of the Airline Operators of Nigeria (AON), Dr Allen Onyema, though described it as a forward thinking approach, but added that the country’s airport infrastructures needed to be improved.

Onyema, who agreed that with the signing of the CTC Practice Direction, that domestic operators would now be able to acquire more aircraft under relaxed conditions, added that the situation would deepen their capacity and lead to reduction in airfares.

“The Cape Town Convention thing alone cannot solve all the problems and everybody knows that; the airport infrastructure has to be improved and airport terminals should be built.

”A situation whereby you don’t have transit facilities is going to hinder the profitability or the ease of doing business on the airlines.

”For instance, Air Peace flies to about 10 African countries, but we have not been able to bring people here like they do in Togo, and assemble people there, then start distributing.

“Midwifing the signing of this practice direction has kind of helped the airlines, the local airlines, now to up their capacity. People have been talking about lack of capacity in the industry, but I give it to the Nigerian airlines.

Among the countries that have since implemented the Cape Town Convention Practice Direction include: China, Ireland, Malaysia, New Zealand, Pakistan, Turkey, United Kingdom, America, Russia and Malta.

Read Also: NSCDC deploys 6,433 operatives for Edo election