The need for Nigeria to have highly functional and globally competitive national airline(s) has for so many years occupied minds within and outside the industry. Like an incubus, the issue has refused to go away. The discourse and arguments are laced with facts, half-truths, blurred perception and, more often than not, highly emotional on the sides of protagonists and antagonists alike. In all, the failure of Nigeria Airways has become an albatross and many an antagonist use it as premise to dismiss any attempt to refloat a new national carrier. Some of them go to the extreme of declaring Nigeria incapable of floating and running a world-class airline. This is unfortunate. It is quite true that our history in the airline subsector is not just chequered, but also gives cause for concern overthe role of the ownership, which is the Federal Government, in the failure of ten attempts made to float and run an efficient National Carrier.
Unfortunately, this antagonist-position has stuck, as it were, in the minds ofNigerians. Very few Nigerians know, even in the industry, that there were three great chances created between 1992 and 2001, any one of which would have put us on a sound footing for competitive airline business operation.
These three chances were Capt Mohammed Jojis Air Nigeria 1992/1993, Engr Ibrahim Janis Turn Around 1997/1999 and the International Finance Corporation (IFC)s New Co 2000/2001.
Capt. Jojis Air Nigeria:
In January, 1992, Capt Mohammed Joji, a member of the AVM Dominic Abdullahi Bello led-Presidential Task Force which was obviously the soundest team ever put together to run Nigeria Airways 1989/1990, was appointed MD/CEO of Nigeria Airways by the then Military President, Gen. Ibrahim Babangida. Capt. Joji, a professional who had worked with British Airways and returned to Nigeria to set up Skypower Express Airways Charter operation, was engaged to run Nigeria Airways. At the end of the two-year tenure of PTF in 1990, Capt. Joji differed with his colleagues which included the likes of Dr. Pascal Dozie, Otumba Adesoye, Ishaku Umar, Stella Ugbonna and late Bassey Itam, wrote a Minority Report.
Armed with these backgrounds, Joji came into Nigeria Airways with a full and clear knowledge of the airline and, working with a Board Chairman of untainted integrity, Prince Tony Momoh, a veteran journalist and one-time Minister of Information under IBB, he hit the ground running.
On arrival, Joji told aviation journalists and staff that the Nigeria Airways he met was in coma and that his first action was to fit an oxygen mask over its nose and then work to revive it. With consummate energy, courage and far-sightedness, he pursued his conviction that the only cure to the coma patient was a privatizationstrategy that will provide the airline not just cure, but a lifeline that will ensure steady growth as well as a birth of a new virile international carrier. In a novel and ingenious restructuring, Joji created a new airline AIR NIGERIA, not as a replacement but to exist together in a symbiotic relationship that would see the ailing mother, Nigeria Airways, fully back on its feet. Air Nigeria was to operate international routes London, New York, Rome, Jeddah and Johannesburg while Nigeria Airways would remain a domestic and regional operator.
To drive this, Capt. Joji engaged a British Consultant, Mr. Keith Bolshaw, who helped to put together a start-up technical team from Swiss Air and Sabena. The foreign technical partner would take 40% equity, Federal Government 40% and 20% would be sold to the public and staff. Nigeria Airways would still remain 100% government. As at this time, Africa and indeed Europe and Asia were still distant from the world of airline Privatization. Only Nigeria Airways and Kenya Airways, another severely sick airline, were taking the leap. At the African Airline Association (AFRAA) annual conference in Victoria Falls, Zimbabwe in 1992, both airlines were requested to present their proposals. Kenya Airways was led by its Consultant, Brian Davis, a former British Airways staff, while Capt Joji and Keith Bolshaw led the Nigeria Airways presentation. At the end, AFRAA adjudged the Nigeria Airways/Air Nigeria model well ahead of the Kenya Airwaysmodel.
Back from Zimbabwe, Joji proceeded to transfer the BASA rights on New York, London, Jeddah, Rome and Jbourg from Nigeria Airways to Air Nigeria. Air Nigeria was programmed to lease from Nigeria Airways its 4 wide-body aircraft: 2 DC10 and 2 A310 and pay a monthly rental of US$1million, which will be used to revive and revamp the ailing mother-airline. As at this time, 100 graduates have,for the first time, been engaged as Cabin Executives for Air Nigeria and were undergoing training.
The aircraft were being checked and refurbished at both Sabena for A310 and at Varig Brazil for DC10 and B737. One great impediment was the mammoth debt of Nigeria Airways which stood at about US$100million. Coincidentally, the then CBN Governor Alhaji Ahmed who suffered humiliation at the hands of British Airways which down-graded him and his family from first-class to a lower one on grounds that the airline was experiencing difficulties in repatriating its money from CBN, was so pained that he personally called Joji to find out why Nigeria Airways could not provide reliable and efficient service.
Briefed about the debt impediment, he asked Joji and Momoh to bring in detailed proposal which, after evaluation, he took a Memo to IBB requesting approval to provide the sum via bond. IBB approved but with a caveat which ran like this:You know my views about Nigeria Airways, if any thing goes wrong with this, in or out of government, I will hold you responsible. Ahmed took this with utmost sensitivity, set up a crack team and personally supervised the direct payment of all verified and certified creditors.
All seemed at this time to be clear for a take-off. But not so. New violent impediments confronted Jojis Air Nigeria: The Unions NAAPE rose against him, the senior Pilots, for very inexplicable reasons, since the new terms of service in Air Nigeria were five times better than those in Nigeria Airways and the junior Pilots on the grounds that remaining in Nigeria Airways would deny them career progression to bigger fleet. Management and senior staff feared loss of jobs while ATSSAN, the Union covering the middle level staff and NUATE complained that the high qualifications demanded for jobs in Air Nigeria were beyond their reach. Pensioners opposed it on grounds that they would lose their privilege of free travel tickets. The then Minister of Aviation, late Wole Adeosun, took offence with Momoh and Joji as well as his Permanent Secretary Gidado Idris, for supporting the privatization programme without his clearance. This led to hot memos between him and Tony Momoh who was Airways Chairman. Adeosun blocked the payment of maintenance fee for the A310 that was being prepared for Air Nigeria;an action that caused the seizure and loss of the A310 to our nation.
The final blow to the novel project was when in the wake of IBBs political quagmire, he replaced Joji with Engineer Andrew Agom in his bid to favour the then Senate President Iyorchia Ayu, who was critical to his political ambition to transit to Civilian President. Agom was the Director of Engineering when Alabo Graham Douglas, as Aviation Minister, sacked Momohs Board and Management for failing to seek his approval to increase fares. Douglas then appointed Agom as Sole Administrator, which created bad blood between Agom, the Board and his erstwhile colleagues. A month later, Douglas was relieved and Momohs Board and Management returned except Capt. Jonathan Ibrahim, the acting MD who was now replaced by Joji. Momohs Board humiliated Agom and eventually fired him. Senator Ayu complained to Babangida to no avail. So when Agom returned, Momohs Board and Joji were gone and with palpable vengeance, he completely dismantled the Air Nigeria/Nigeria Airways programme, reversed everything Joji did and ran back into the waiting hands of a Ministry that was bemoaning the loss of its first-class Parastatal, Nigeria Airways.
The way Joji left, he still left the oxygen mask over the nose of ailing Nigeria Airways but there was no longer oxygen in the cylinder and Agom was not interested in the refill. And so, for a great idea which would have taken our nation to the heights, prima facie, the last line on its epitaph was Consumatum est it is finished. Interestingly, Arap Moi continued with Kenya Airways programme despite protest from the airlines unions and vested interests. Today, Kenya Airways, The Pride of Africa, bears out this wisdom of national interest being put over personal interest. No doubt, had Joji been left, Air Nigeria would have been The Star of Africa,and the over US$1.5billion being lost annually to foreign airlines would have been curtailed. But Capt. Mohammed Joji lived many years ahead of the time.
The Jani Ibrahim Turnaround Magic of 1997/1999:
The Second great opportunity thrown away was in 1997/1999 when Alhaji Jani Ibrahim, an oil and gas industry professional with experience in Property Management was appointed the MD/CEO of Nigeria Airways. Jani Ibrahim entered the aviation industry as an unknown quantity and a neophyte as it were. Nobody knew his full background. He was considered by Airways staff as one of those unplained pegs that the government usually brought to the airline under job-for-the-boys syndrome. Nobody had the foggiest idea about Janis vast business experience, nor his superior intellect.
Jani took over from Group Captain Peter Gana, a serving Air Force officer, who took over from late Engineer Agom. With Agoms foreclosure of Jojis Air Nigeria project and return to the Ministry, the airlines fortunes began a new decline. By the time he handed over to Gana, the airlines challenges had mounted. The debt profile, both domestic and external, had risen, over-flight charges to ASECNA and ENESA had mounted, insurance premium unpaid and operational aircraft grounded or seized. Delays in staff salaries set in and pensioners were in the cold. Nigeria Airways was no longer operating to London due government policies and the airlines debts. This was Ganas operating environment.
By the last week of Ganas exit, the challenges of his inherited operating environment had snowballed into strangulating dimension as the airlines Insurance Broker Alexander Howden, had withdrawn its insurance cover which crippled all operations including the two last return Christian Pilgrimage flights out of Israel. As the crises raged on, Peter Gana was removed and replaced with Jani. With severely contracted operations and mounting debts, even Drucker would have shuddered. Many a manager would have sought funding from the government. But Jani did not. Rather, armed with a first-class Engineering degree and, most probably, one of the soundest minds that ever ran Nigeria Airways, he proceeded first with a painstaking study of the airline challenges so as to know theAchilles point in the vicious cycle of the dwindling fortunes of the airline. His first action was to keep the skeletal operations ongoing. Then, he invested the airline pension funds which had been left sitting with no accruing benefits. Hethen cut down travels, sought to expand cargo operations through leases and began debt negotiations to achieve debt restructuring and reduction. As at this time, Nigeria Airways was not flying to London due debt issues and Abachas sanction on BA, banning its operations in reciprocity. Nigeria Airways was also not operating to New York, primarily due to the US ban on Murtala Mohammed Airport, citing safety issues. So, unlike his predecessors, Jani had only Jeddah, a religious pilgrimage route, rather than high traffic commercial routes and Dubai, a new route started by Peter Gana and still under development.
Jani now turned to his Management with a gospel of partnership with airlines African and foreign that Nigeria Airways could reach a code-share or joint-venture arrangement to enlarge its market share and widen its revenue base. Under consideration were Ethiopian airline and Cameroon airline. But before this could emerge from the drawing board, Jani suffered a setback. Jani was picked up by the Directorate of Military Intelligence over allegation of involvement in Abachas phantom coup. Many believed that was the end of Jani, even if he was freed, he would not, as is usual, be allowed to return to the airline. However, in the period of his absence, while one hawkish director, in fact the most junior, pushed to replace him, the Management he left stepped up his joint venture idea and entered into a despicable arrangement with Bellview Airline, a domestic airline, to fly Nigeria Airways Amsterdam route.
The Agreement exposed the lack of knowledge and exposure of the Management to business negotiations. The smarter MD of Bellview Kayode Odukoya went away with the meat, leaving Nigeria Airways with feathers he easily could shed and shed, he did. Just on the day of commencement of the Bellview operations, Jani surprisingly returned to his job with his integrity intact. He ran through the Agreement and literally blew up at the ridiculous terms. All attempts made to redraw the Agreement were rebuffed by Bellview as it continued operations. Jani distanced Nigeria Airways from that operation, refused to repudiate the agreement, predicting the collapse of the operation without Nigeria Airways involvement. He was correct the Bellview venture to Amsterdam faced loss-making challenges and eventually collapsed with the repossession of its operating aircraft due default in lease payment.
In the very short course of time, Abacha shockingly died. Gen. Abubakar who succeeded him lifted the ban on British Airways and this was the great turnaround opportunity which nobody in Airways imagined. Only Jani imagined and saw it. For us all in Nigeria Airways, British Airways was not only a colossal competitor but a predator. In pursuit of his strategy, Jani opened up contact with BA authorities led by Allan Burnet, and secured the first ever assistance when BA offered Nigeria Airways two of its B737 to lift players round the country during the FIFA U-21 world cup hosted by Nigeria. The BA gesture was at no significant cost to Nigeria Airways despite the revenue which accrued, though NFA did not pay substantial part of the bill till the airline demise.
Jani further solidified this new relationship as it now opened up a JV partnership discussion with BA. The mutual respect that arose culminated in one of the best airline JV ever entered into by any airline globally. As at this time, all Nigeria Airways wide-body aircraft DC10s and A310s were either grounded or seized by creditors. Jani agreed with British Airways to deploy one of its B747 jumbo to fly Nigeria Airways seven weekly frequency on the Lagos/London route. The aircraft would be painted in Nigeria Airways livery, use Nigeria Airways call-sign. The aircraft would be operated by British Airways with some Nigeria Airways cabin crew, trained by BA in joint operation with BA cabin crew. Nigeria Airways was to have 100 seats free and would not incur any cost whatsoever for the entire operations. This JV was approved by late Dr. Olusegun Agagu who was then the Minister of Aviation.
Having achieved this, Jani turned to the marketing department, especially to the highly resourceful manager in London, Jonathan Jiya, charging him to fill up the 100 seats. Following Janis footsteps, Jiya, who later became MD of Nigeria Airways and now traditional ruler of Esan community in Bida, invented, for the first time ever in the global aviation industry, the 2-piece concept which allowed passengers to check-in two baggages of 23kg each. Jani approved this and its market success alarmed not only BA but all European airlines at inception. Today, 2-piece concept is now a global practice. Not many Nigerians, let alone the global aviation world, know that the innovative marketing strategy was a Jiya/Jani creation.
More importantly, the British Airways JV earned Nigeria Airways N100million monthly. This improved liquidity, made timely salary payment easier and regular, same for pension and freed revenue from other sources for debt repayment, administration, retraining and maintenance.
In fact, on Obasanjos election to office in 1999, Jani had gone to brief him about his plans to extend the JV to the New York route and how he would turnaround Nigeria Airways without any money from the government. OBJ had told him that he was seeing for the first time a young man saying he did not need money from government to do such job and said to him: I need you in the Presidency. Jani probably did not realize that OBJ had already put in motion the process of engaging IFC to work on Nigeria Airways privatization.
Towards the close of 1999, in the usual Ministerial hobby-horse of changing every Management, performing or non-performing, Agagu replaced Jani with Yomi Jones. This signaled the end of a great pathway to recovery and pride. If Joji lived ahead of his time, Jani proved that ideas, not money, make most remarkable changes in life. If Jani had been left, we would have been a member of the global airline alliance called One World which includes BA and American Airlines.
The IFC New Co:
For most Nigerians, May 1999 heralded a great new hope not just because of the dawn of democracy after over sixteen years of painful military regimes, but because of the newly elected President Chief Olusegun Obasanjo, who Nigerians believed had integrity and held so much promise.
Before even assumption of office, OBJ had made statements that gave indication of his mindset. One of these included the decision to privatize the ailing National Carrier Nigeria Airways. True to his promise, the then President, on assumption of office, created the National Council on Privatization (NCP) headed by the Vice President Atiku Abubakar and a Secretariat for NCP, the Bureau of Public Enterprise BPE. And on October 7, 1999, the Agreement for Nigeria Airways privatization was signed between Nigeria and the World Bank. Atiku initialed for Nigeria while James D. Wolfensohn, President of World Bank and IFC, initialed for the World Bank. The World Bank appointed its investment arm International Finance Corporation IFC to handle the assignment. IFC as the lead Consultant worked with six other Consultants: Nathan Associates, Ashurst Aviation and AW Consultants Ltd for technical matters, Northon Rose (UK) and Olaniwun Ajayi and Co (Nig) for legal matters and Arthur Anderson Nigeria for accounting matters. The mandate was: Restructure and Privatize Nigeria Airways. It is very noteworthy that the entire process was transparent to the absolute.
The Consortium of Consultants took their job with professional excellence as they carried out in-depth, extensive and all-encompassing study of not just Nigeria Airways, but the entire Nigerian Aviation/Airline industry and market.
About a year later, IFC had produced its Report in a 147-page compendium. The Report was accepted by the NCP, the Aviation Steering Committee ASTRIC, chaired by the Minister of Aviation as well as the Federal Executive Council. The stage was then set for Phases 2 and 3 of the Project which were respectively SALE PREPARATION and SALE IMPLEMENTATION. Nigerians had high hopes, but the incubus again showed up.
Someone had gone to tell OBJ that his Vice President was organizing to buy Nigeria Airways from IFC through BPE. This incensed the President who then decided to scuttle the whole project, using his then Minister of Aviation Dr. Kema Chikwe. Through her, the President undermined all the recommendations of IFC that guaranteed successful privatization.
On October 28, 2000, the NCP wrote a 13-page memo complaining to the President of the disruptive actions of the Minister to no avail. Simpliciter, Kema Chikwe was acting the Presidents script. By the turn of 2001, it became clear that no reprieve was coming. The IFC, on March 15, 2001, in frustration, informed the Minister of its decision to withdraw in a 2-page letter signed by its manager, Mr. M.D. Leonard. Thus ended a highly redemptive dream and we went back to our ignoble squalor. Once again, an excellent venture that would have put us on the platform of global elite airline operation was shot down at the altar of personal political emotions and intrigues by same man who originated it. Our nation was the loser.
Without fear of being controverted, had Joji, or Jani or indeed the IFC been allowed to drive on, our nation would have been a cynosure of successful airline operations.
No matter what, as the effort to find a solution to the floatation of a sound National Carrier continues, the stunning strategies of Joji and Jani as well as the IFC advisory and excellent professional approach will all combinedly be a prolegomenon to any future effort towards floatation of a virile National Carrier.
Chris Aligbe
kandimuwa@yahoo.com
