Professor Obiora Okonkwo, the Chairman of United Nigeria Airlines, has commended the foreign exchange (forex) policy introduced by the administration of President Bola Tinubu, highlighting its significant benefits to the aviation sector. Speaking at an event marking the 4th anniversary of his airline in Abuja, Okonkwo emphasized how these policies have alleviated longstanding challenges faced by local airlines in securing foreign currency for operational needs.
“The forex policy of the Tinubu administration has been of tremendous advantage to the airline industry,” Okonkwo stated. He detailed how the policy has provided relief by allowing easier access to foreign currency, which is crucial for airlines due to the dollar-based nature of the industry, from aircraft maintenance to leasing and fuel procurement.
The policy, which includes measures to stabilize the naira and facilitate forex liquidity, has directly impacted the operational efficiency of airlines. Okonkwo noted that before these changes, converting naira to foreign currencies to meet obligations was a nightmare, leading to lost contracts and strained vendor relationships. “Now, the situation has improved, and the government has cleared nearly a billion dollars in backlogged funds for foreign operators,” he added, indicating a positive shift in Nigeria’s aviation sector’s international reputation and relationships.
Moreover, Okonkwo highlighted the domestication of the Cape Town Convention as another beneficial aspect, reducing operational costs by streamlining leasing agreements and providing better access to aircraft and equipment without the previous financial burdens. “These policies have opened new windows for better relationships and integrity in the international aviation industry,” he said.
Despite these advancements, Okonkwo also pointed out areas needing further government intervention. He stressed the necessity for single-digit loan facilities for local operators to bolster the industry’s growth, given the thin profit margins and the high costs of multiple government charges. “The profit margin in this business is very low. Meeting all those charges leaves us with nothing,” he explained, urging for a reduction in these charges to promote industry expansion.
The aviation sector in Nigeria has been under scrutiny for various reasons, including high ticket prices, which Okonkwo linked to these operational costs and forex challenges. However, he expressed optimism that with continued support and policy refinement, the aviation industry could achieve its potential to contribute to Nigeria’s economy, aiming for the $1 trillion economy target set by President Tinubu.
Okonkwo’s remarks have reignited the conversation on how government policies can be tailored to not only address immediate financial constraints but also build a sustainable framework for the aviation industry’s long-term growth in Nigeria.
