Nigeria tells airlines to raise money or close
Source: Reuters
ABUJA, Jan 17 (Reuters) - The Nigerian government on Wednesday raised the minimum capital base for airlines by up to 25 times and said carriers had to meet the requirement by April or lose the right to fly. Minister of State for Aviation Femi Fani-Kayode said the government adopted the measure because Nigerian airlines were insufficiently funded and were operating old, dangerous planes. "This led to a situation whereby airline operators in Nigeria were basically using many, many old aircraft which is not acceptable and dangerous," Fani-Kayode told reporters after a cabinet meeting adopted the measure. Poor aviation safety is a burning issue in Africa's most populous country, where three passenger aircraft crashed in the year to October 2006, killing 319 people. Fani-Kayode said the minimum capital base for airlines that operate only domestic routes would rise to 500 million naira ($3.9 million) from 20 million naira now. For regional carriers, the required capital base doubles to 1 billion naira, while for those operating long-haul routes it will double to 2 billion naira. Fani-Kayode gave no indication of how the airlines were expected to raise the money. The largest names in Nigerian airspace would probably meet the new requirement easily, but some smaller operators could struggle, analysts said. Fani-Kayode also said all aircraft would now be required to carry a GPWS or ground proximity warning system, a device which alerts pilots if they are in immediate danger of hitting the ground. "Any airline that can't meet these conditions in April will not be allowed to operate," said Fani-Kayode. Aviation is one of many sectors suffering from the effects of mismanagement, corruption and neglect under military regimes that ruled Nigeria for most of its post-independence history. Passenger traffic has more than doubled since the return to civilian rule in 1999 but the ageing fleets and airports have struggled to keep up.
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