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Africa
Aviation dispute halts Nigeria's airlines
Thousands of passengers left stranded after Arik Air shut down by authorities over unpaid aviation fees.
Last Modified: 22 Sep 2012 00:34

A number of airlines in Nigeria have been ordered to stay grounded by the country's aviation authorities in a multimillion dollar dispute relating to aviation fees.

Thousands of passengers have been left stranded after Arik Air was shut down on Thursday in the latest in a string of airlines to be grounded because of financial irregularities and safety concerns.

Only two of Nigeria's nine domestic airlines are now flying, as others remained grounded over maintenance, financing or other problems.

Nigerian domestic air travel had already been complicated after the collapse of the country's second largest airline Air Nigeria in a scandal over tens of millions of dollars in unpaid taxes by its owner.

Arik Air Ltd, the largest carrier, indefinitely halted its domestic flights on Thursday claiming that the nation's aviation minister wanted to destroy the company for her personal profit.

Aniete Okon, the company's vice chairman, blamed the Nigeria's Aviation Ministry and Aviation Minister Stella Oduah for trying to stop the airline from flying.

An aviation ministry spokesman denied the allegations and said Arik Air was trying to distract the public, whereas it owed the government $110m.

Arik Air officials acknowledge that debt and said they make monthly payments to try and resolve it.

Aero Contractors Co of Nigeria Ltd, another airline frequented by foreign oil companies working in Nigeria, owes more than $203m to the state-run company, according to the Central Bank.

Simon Tumba, a spokesman for Aero Contractors, declined to immediately comment on Friday.

Officials said Nigeria's Central Bank had barred the nation's top two airlines from receiving any additional loans over their massive outstanding debts.

Nigeria’s domestic airline industry has been in crisis over safety and financial management since June, when a passenger plane belonging to Dana Air plunged into an apartment block in Lagos killing more than 160 people. There's been no explanation yet as to what went wrong.

A Central Bank spokesman said any bank that gave companies or individuals on the list loans would face serious fines from the government.

While acknowledging the struggles of the airline industry, the spokesman said the bank could not allow massive debts to pile up on the nation's banks and threaten the financial market.

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Source:
Al Jazeera
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