*Talks about challenges in the aviation sector
*Speaks on Igbo nation and the way forward
Prof. Obiora Okonkwo, an Officer of the Federal Republic, OFR, is a professor of business studies at the University of Abuja Business School as well as a visiting professor of entrepreneurial studies at the Nnamdi Azikiwe University Business School, Awka, Anambra State.
He is the chairman of United Nigeria Airlines Company Limited as well as Chairman of The Dome Entertainment Limited, the prime entertainment hub in the Federal Capital Territory, FCT, Abuja.
A Russian-trained academic cum business mogul, Prof. Okonkwo is also the spokesman of the Airline Operators of Nigeria (AON), the umbrella pressure group of the major operators in the airline industry which has been at the forefront of pushing for seamless operations of the sector as the fulcrum.of the economic growth of Nigeria. In this interview, he speaks on a plethora of issues and offers some suggestions.
Excerpts:
Finally, Bola Ahmed Tinubu has become president and commander-in-chief. How would you describe his administration in the last nine months without prejudice to your political leaning or affiliation?
Well, this is a time for governance and not politics. This is a time when all hands must be on deck. And I’ve contributed my quota to the economic development and stability of this country, bearing in mind that I’ve never had any government appointment.
I can only see a period of so much confusion, a people overwhelmed from all aspects of it, and for that reason, there has been a lot of inconsistencies and policy summersault. That gives me some concern. The Tinubu we used to know is said to be capable of head hunting for the best people in different positions.
But this presidency appears to be proving otherwise. We had expected him to embrace a better national outlook based on his relationships across the states and zones, we expected him to bring in a lot of great people who would support this national objective. But that’s not the case. It is not that those he has appointed are not qualified, but there are greater potentials out there. But we expect him to be bold enough to make critical changes.
Nigeria, today, is in the ICU section of a hospital, and all the specialists are needed to do an evaluation. This is not the time for just one doctor to attend to a normal patient who needs just routine checks. There is no time to waste now because this team does not look like a winning team. The drive and the demand of the moment appear to be too overwhelming. All we seem to be hearing is that we should be patient, and patience appears to be running out. That is why you are seeing some of the things you’re seeing, where people are involved in breaking into warehouses, hijacking trucks on the road, and carting away food items.
If they have plans, Nigerians are not being carried along. Things are not going well. Yet, in the midst of this, some people are living the affluent life, not because their businesses are doing well (that is if they have a business) but because they are close to those in government or they are in government.
But they claim that they are doing some things, and the patience they are asking for is contingent on their belief that they are doing some things across sectors. They also say they inherited an empty treasury, that they inherited a dead horse that was standing?
Expectedly, they are supposed to be doing something, but in a situation like this, policies that will resonate with the masses are needed. We have seen some of their policies, it is one harsh policy after another and these policies are not only making things harder for people, but these are policies that seem to be dealing with symptoms, policies that are merely scratching the surface.
Give one or two examples of such policies for clarity?
Look at the CBN, for instance. The CBN is focusing on reducing the money in circulation, and the MPR rate being raised, itself, raises some fundamental questions. Where is even this money they claim they want to reduce? It is the same CBN that will be telling us that 60% or so of the money is not in circulation.
So, where is that money in circulation that they are chasing with different policies? I would rather think that increasing the interest rate will lead to higher rates from the banks. We were already crying that it was 26%, now it will move to almost 30%. That is where you are clear that there is so much money in circulation in the hands of the real sector and it is chasing a smaller amount of dollars out there. But the same CBN knows for a fact that 70% of all the resources, apart from the one they say is there and nobody sees, are in the hands of those in government and that is what is being used to mop up the dollars being stashed in different places. Would it not have been better for the president to have a round table with these governors and government officials and not embark on policies that are very theoretical. Deal with the issues and stop scratching the surface.
They said they have stopped the subsidy and the FAC allocation has increased. You are supposed to see more activities from the bottom up. Now, some of these governors have been appointed as part of the economic team to solve a problem that they are a part of. Again, you claim you inherited an economic mess, yet some of the people in the previous administration’s economic team are re-appointed into your own new economic team. How can banks be making multi-billion profits, and the real sector is going down? So, I ask, how is our own so: The real sector is going down, and the banks are making money, so, what are they doing? Okay, you sit down with bankers, governors, and cement manufacturers as part of your economic team, yet the problems of the country can be traced to those sectors. To get things working, you’ll need policies that will impact those sectors. So, how will that be done when the captains of those sectors are in the economic team?
Before you go further, there seems to be this consensus that state governors and top government officials are the ones mopping up dollars because of the spike in FAC allocation. Is there any proof to this claim because many experts seem to be saying the same thing about the instability in the forex market? Is it just an assumption, or is there a basis for this claim?
I’d raised the alarm sometime in January about the nexus between the increase in FAC allocation and the instability in the forex market. What is going on in the forex space is speculative. I’m in the real sector, and we don’t even see these dollars. We scavenge for dollars to stay in business. The increase in FAC allocation should be wonderful, but we have a situation where state governors play god and decide on how the funds are spent. Look, APC has a majority of the states and I do not see why it is difficult for the FG to call – even if it is APC – governors who should be interested in the success of the APC federal government and be on the same page, instead of allowing the state governors to run riots with funds.
The concerns and cries are coming from corners that are far from Abuja. Where is the place of the councillor and the LG chairmen? We have been talking about the devolution of powers, and it was such a strong issue during the campaigns. But here we are today, and people are now sitting pretty and enjoying the powers of centrality. You are in government to do what is best for the people. People are complaining that the policies are killing, yet people are carrying on as if the people do not matter. The policy should affect the people positively.
I’d also said that we should watch out for food. I’d said whatever the government is doing, the issue of food production is key, but I do not see this government upholding some policies targeted at food production as pursued by the last administration. Hunger is a very dangerous thing, and the last administration put in certain policies that were impactful, and they were going directly to the beneficiaries. But today, it appears different.
Also, look at the way people are being fired from the boards, and many are yet to be replaced. This vacuum is creating its own dysfunctional vibes within the system. Meanwhile, you took over from an APC administration. One of the biggest problems the Buhari administration created for itself was that when it came in, without appointing ministers for almost seven months, boards were dissolved, 18 to 19 permanent secretaries who were acting ministers in their ministries were also sacked not because they were due. They were then told to hand over to the highest officers in their ministries, and these so-called most senior officials were just directors.
The Expatriate Employment Levy sent shockwaves around the real sector penultimate week when it was launched; but it’s now been suspended?
First, let’s acknowledge and commend the reversal by the government for now. Look, we are already spending thousands of dollars to formalise the expatriate quota in Nigeria. It would have been a nightmare for companies that are already suffering under the weight of taxes. The companies need to survive first and in some aspects they need foreign components. Let me tell you, Jide, with the current exchange rate today, you do not need any policy to tell anybody to replace expatriates with Nigerians where you can. We have expatriates and we know how much we are paying but there are areas where you need the expatriates because there are MOUs you have signed and the companies are insisting that for technology transfer, those expatriates must be on ground. There are also areas of maintenance.
This would have affected the aviation sector more, I guess?
In aviation, for instance, there are equipment that you need to bring in, and for you to operate them, you need the expatriates because we have not developed the capacity here. Between October and December last year, I had to send over 40 people overseas (Cyprus and Jordan) to get a time on the A320. They went there to understudy, and before they come back, they still have to work with some of the people in that aircraft before we now replace them. I do not think it really has anything to do with employment. In my view, I think it is the desperation to generate revenue. But in the cause of generating revenue from LGs to state and FG, this tax issue is being misunderstood.
The aviation sector generally…
(Cuts in) The aviation sector is bleeding seriously.
That’s frightening?
Oh yes! This is the part where we have to say it the way it is.
A recent report said the number of aeroplanes in the fleet of some airlines is dropping?
And they are continuing to drop. I can tell you that about 40% has dropped and in the next one or two months it might get to 70% drop in fleet. And it is not the fault of the aviators.
So, what is the real problem?
Look, 99% of aviation is forex, and the currency of aviation is dollar. So, starting from those who are marketing JetA1 fuel, they bench-mark their cost in dollars, and all the spare parts you need are bought in dollars. Unlike your car, which you service when you notice something bad, it is not the same with aviation. There are services that you must do by calendar whether you fly or you do not fly; some services are by cycles whether you like it or not. What this means is that things must be done as they should be done, not as you like because if you do not follow the procedure, the aircraft is grounded. You’re doing all these with dollars. But now you can not access the dollars, and 100% of our earnings on domestic flights are in naira, which is losing value. The ticket you sell today in naira, by the time you convert it to dollars to buy spare parts and do maintenance, it has been up by almost 30% to 40%.
I can tell you that for almost nine months, we have never had an official allocation of forex for airlines. Every airline is buying from the parallel market. So you’re buying in the same market with somebody who is importing Brazilian hair, toothpick and those who are also mopping up the forex. It should not be so because aviation is a catalyst for economic growth, and it has national security implications. Some of us still have in CBN huge sums of money we’ve been debited for two years now: We do not have our money back and the dollars we did not get.
Wait! You mean you paid for forex, you were debited, but there’s no forex yet?
Yes! You bid and wait for a few months. But now it is almost 18 months. Before it was we in the aviation sector, which used to complain a lot, but now it is affecting everybody, so you hardly hear from us again.
Is that not a recipe for disaster in the air? I pray not, but wouldn’t people be cutting corners?
No, no, no! It won’t. The only impact is what you’re seeing – a reduction in the fleet. Nigerian regulators are very tough, and operators are also very sensitive. I fly in my own aircraft. My first choice is my own aircraft unless the schedule does not permit. We fly in each other’s aircrafts so we observe the best practices you can find anywhere in the world. It’s just the loss of jobs, reduction in the number of planes, and that is bad.
Let’s look at this issue honestly, too, because there was a time when it was said that aviators were involved in round-tripping when the federal government tried to provide support for them with forex…?
That may have happened over a decade ago, and I do not know about that, but since I got in in the last 10 years, I’m not aware of that. The situation is different, and that could have happened because the monitoring systems were not effective, and it couldn’t have happened without official collaboration.
Let’s look at the Igbo nation. How do you think that part of the country can fully integrate so that what it has lost from the centre will be regained. I’m talking about expectations from the central government and what it should do to endear itself to the Igbo people?
Interesting question! I believe in the unity of this country, and it is one that can be achieved based on equity, justice, and fairness. We can not continue to talk about what Igbos should do to be integrated.
No, the question is, what do Igbos expect? Igbos appear to have contributed their own quota?
Okay. The counterpoise would seem to suggest that the Igbos have been doing something wrong all along. Yes, we may not have been calculating well politically; we may not have been getting it all right. But the fact of the matter is that if this is our thing and you accept that I am part of it, you have to be equitable in the process of sharing. So, the blame should go to those sharing and deliberately depriving that other person. Igbos are everywhere, and they are working hard, but they are being marginalised. Even the constitutional appointments are given to those who are not true representatives in terms of choice.
What should now be done?
The people who share must be fair. When you favour others more, you should expect people who are being deprived to complain. One of the things being done to weaken people is to deprive them of their rights. Meanwhile, these people give their best in every area where you have appointed them. But what I have seen is that people in political positions think they know everything, so they lump politics and knowledge together. The political class can not separate itself from the intellectuals. You must have some people somewhere who do the thinking, and then the politicians, working with bright minds, can then implement. Because of the disregard for education and intellectual issues, we keep fumbling as a nation.
We have great minds from the southeast, but when you see the quality of some of the appointments, you’ll wonder whether these are the best Igbo people can offer.
In my view, the misreading of the political barometer appears to have conflicted some Igbo leaders in such a way that whereas there are charlatans (as you have in every tribe in Nigeria), some who appear to even be genuinely pursuing Igbo interests within the praxis of a bigger Nigeria are sometimes pilloried or scoffed at by their fellow Igbos. This has not also been helpful because even those who are genuine are seen as enablers of the oppressors. So, how would you situate past efforts of leaders in trying to get the centre to do right?
You know these things are never done in secret. Every individual has antecedents and records. Igbo people are intelligent enough to know leaders who genuinely want their progress, regardless if it is a government they want or they don’t want. When they see that person, they will rally around the person without inhibitions. But when they test some people, they see the pretence when people pursue their own agenda while pretending to be pursuing Igbo interest. Or when you see the appointment of somebody by the centre as further deliberate action to weaken the Igbo nation. When the people see those things that you know will not work well, the people resent that. Some people thrive by scandalising their own people to get favour from the centre. It will also not be out of place to posit that the centre does it sometimes to sabotage the Igbo nation by empowering untrustworthy people just so such individuals will go back home and become a thorn in the flesh of the people. Igbo people know their own, and the people know genuine leaders when they see one.