The Centre for Promotion of Private Enterprise said the 30 percent debt discount for airline operators will not address the deeper structural challenges the aviation sector in the country faces.
CPPE disclosed this in a statement by its Chief Executive Officer, Muda Yusuf, on Sunday.
According to him, while the government’s effort at addressing surging operational costs due to multiple taxation and skyrocketing aviation fuel known as Jet A1 is commendable, the move will not bring long-term relief.
The economic think-tank urged the federal government to completely rationalize the sector through adequate streamlining of its multiple taxes as the long-term solution to the country’s aviation sector challenges.
“A streamlined and moderated cost structure is imperative. Reducing both the multiplicity and magnitude of these charges will significantly enhance the viability, competitiveness, and resilience of domestic airlines.
“This is not only an economic imperative but also a safety consideration, as excessive financial pressure on operators could have unintended consequences for operational standards.
“Government support for the aviation sector must therefore go beyond debt relief. What is needed is a comprehensive reform of the aviation cost environment to ensure that domestic airlines are not overburdened by charges that undermine investment, weaken service quality, raise ticket prices, and threaten the long-term sustainability of the sector,” CPPE stated.
This comes as the Nigerian government last week announced a 30 percent debt discount to airline operators to avert shutdown and airfare increases.
Airline operators had threatened to disrupt the country’s aviation sector if the federal government failed to intervene in about a 300 percent rise in JetA1.
