Economic challenges in the Nigerian aviation industry

Executives in the Nigerian aviation industry are calling for government intervention to address severe economic pressures threatening the survival of air carriers.

Initially, United Nigeria Airlines leadership highlighted structural challenges, including a currency mismatch where revenue is earned in Naira while major expenses like maintenance and pilot training are paid in foreign currency. They also cited rising fuel prices and high financing costs as primary drivers of financial strain.

As the situation progressed, industry leaders at the League of Airport and Aviation Correspondents conference emphasized that borrowing costs have reached as high as 30 percent. Air Peace Chairman Allen Onyema described the current environment as “extremely hostile to sector growth,” calling for tax reviews and better access to capital.

Regarding regulatory debts, United Nigeria Airlines Executive Chairman Obiora Okonkwo addressed unpaid Ticket Sales Charges (TSC), noting that while airlines were previously compliant, economic shifts necessitated relief. He reported that the President granted a 30 percent waiver on these charges, and airlines are currently working with regulators to establish repayment frameworks for legacy debts.