Nigeria’s Ambitious Plan to Launch an Aircraft Leasing Company
Nigeria is taking a significant step forward in its aviation sector by planning to establish an aircraft leasing company. This initiative, announced by the Minister of Aviation and Aerospace Development, Festus Keyamo, aims to address long-standing challenges in the industry and position the country as a key player in regional and international air travel.
Keyamo made the revelation during the arrival ceremony of the first dry-leased aircraft by Air Peace at the Murtala Muhammed International Airport in Lagos. The event marked a milestone in the nation’s efforts to improve its aviation infrastructure and support local airlines.
Understanding Dry Leasing and Its Implications
Under the dry lease arrangement, Air Peace received a Boeing 737-700 aircraft. In this model, the lessor provides only the aircraft, while the lessee is responsible for crew, insurance, and maintenance. This differs from wet leasing, where the lessor also supplies the crew and operational support.
Historically, Nigerian operators faced difficulties in securing aircraft leases due to concerns about trust and contractual obligations. To address these issues, the Federal Government signed the Cape Town Practice Direction in 2024. This legal framework allows lessors to terminate agreements if operators breach their terms, providing a level of security that has now enabled Nigerian airlines to engage with international lessors.
A Collaborative Effort to Boost Aviation
The signing of the Cape Town Practice Direction was followed by a delegation of Nigerian operators traveling to Dublin, where discussions led to agreements to lease aircraft to Nigerian airlines. The event brought together several dignitaries, including the Director-General of the Nigeria Civil Aviation Authority, Chris Najomo; the Managing Director of the Federal Airports Authority of Nigeria, Bunmi Kuku; and the Irish Ambassador to Nigeria, Peter Ryan. Financial partners such as Kevin Ugwuoke, Executive Director of Risk Management at Fidelity Bank, were also present.
Keyamo emphasized the administration’s commitment to transforming Nigeria into a major aviation hub, stating that the country “has the rules and the market.” He revealed that discussions had been held with the Minister of Finance, as well as investment teams from Dubai and Dublin, to structure the new venture.
Building a Sustainable Aviation Ecosystem
The proposed aircraft leasing company is expected to serve as a middleman between Nigerian operators and international lessors and manufacturers. This initiative is designed to boost the aviation industry by making dry-leased aircraft more accessible and enabling local operators to compete effectively with international airlines.
Keyamo highlighted that the plan has been part of the aviation sector’s roadmap for the past 15 years, but previous attempts to implement it have failed. He expressed confidence that his administration would succeed, noting that the structure is tailored to support local airlines.
Challenges and Progress
Despite the challenges, Keyamo noted that steady progress is being made in the sector. He praised the collaboration between different arms of government, including the President, Vice President, Judiciary, and National Assembly, all of whom have supported the mission.
Air Peace’s Commitment to Excellence
Allen Onyema, Chairman of Air Peace, commended Keyamo for his dedication and the reforms he has introduced. He acknowledged that the aviation sector had struggled with capacity issues until Keyamo identified the gaps and initiated changes to strengthen local airlines.
Onyema emphasized the need for wide-bodied aircraft and stated that Keyamo has changed the narrative around Nigerian airlines. He pledged that Air Peace would ensure top-notch maintenance of its aircraft to maintain the confidence of international lessors.
“We will ensure that our maintenance is world-class. We represent Nigerian airlines and carry the aspirations of the nation. Given the support we’ve received from government and the Nigerian public, we will not fail,” Onyema said.
Looking Ahead
As the proposed aircraft leasing company moves forward, the focus remains on creating a sustainable and competitive aviation ecosystem in Nigeria. With the right strategies and partnerships, the country is poised to become a major player in the global aviation industry.