Aviation Industry’s Slow Recovery from Covid-19 Devastation

aviation - July 31, 2021

At the League of Airports and Aviation Correspondents (LAAC) conference held on Wednesday in Lagos, the Managing Director of the Federal Airports Authority of Nigeria (FAAN), Captain Rabiu Yadudu said that it would take a long time before the aviation industry would recover from the devastating effect of Coronavirus pandemic.

He said that the pandemic stifled the operational funds of aviation agencies, stripped airlines of capital and left the handling companies and other service providers writhing in abject need of credit from financial institutions.
Yadudu said that the aviation industry is in need of financial support, saying that the industry needs financial engineering.

“It will still take some time for the aviation industry to fully recover. We must focus on financial engineering. The aviation agencies are feeling the negative impact of the pandemic. Financial support must come our way,”he said.

He said that the devastation of Coronavirus is global and affects every country with tremendous negative impact on the air transport sector, adding that in terms of competence, experience and operational efficiency, the industry in Nigeria can compete with any other country in the world.
Yadudu said that the industry is still in distress and in dire need of funds, stressing that without financial help the possibility of recovery in the foreseeable future is slim.
“We are still in distressed because we need relief. Without financial help I don’t see any recovery,” he said.

The FAAN Managing Director said that there are good policies that would guide the industry effectively but the challenge is implementation of these policies to achieve desirable results.
He added that in addition to formulating good policies for the sector, there is still more to be done, adding that to make the industry move forward, there is still much to be done, so policy implementation is very important.

“We should make sure that we grow all areas of the industry so we must keep on working together and we should not allow divergent opinions and views to tear us apart. So we should work together. We must spearhead the change that we want, so moving at different directions at this time will have damaging effect on the industry, so it is very important that we work together,” Yadudu said.

The Chairman of Senate Committee on Aviation, Senator Smart Adeyemi also called for financial support of the industry, saying that it would take a long time for the sector to make a positive turnaround.

“The aviation industry has improved significantly and the sector is very critical in the economy of this nation, so whether the economy is good or not, the aviation industry plays very key role, but the industry needs palliative, especially the airlines. It takes a lion heart to invest in airline business,” he said.

The International Civil Aviation Organisation (ICA0) said that COVID-19 virus has spread worldwide without acknowledging borders.
“It has impacted all industries, all sectors and all aspects of our lives with devastating economic and financial losses and significant uncertainties.

Also, the International Air Transport Association (IATA) has announced that passenger demand performance for June 2021 showing a very slight improvement in both international and domestic air travel markets, noting that demand remains significantly below pre-COVID-19 levels owing to international travel restrictions.

IATA disclosed that as comparisons between 2021 and 2020 monthly results are distorted by the extraordinary impact of COVID-19, unless otherwise noted, all comparisons are to June 2019, which followed a normal demand pattern. The record is as follows: total demand for air travel in June 2021 (measured in revenue passenger kilometers or RPKs) was down 60.1% compared to June 2019. That was a small improvement over the 62.9% decline recorded in May 2021 versus May 2019.
International passenger demand in June was 80.9% below June 2019, an improvement from the 85.4% decline recorded in May 2021 versus two years ago. All regions with the exception of Asia-Pacific contributed to the slightly higher demand.

Total domestic demand was down 22.4% versus pre-crisis levels (June 2019), a slight gain over the 23.7% decline recorded in May 2021 versus the 2019 period. The performance across key domestic markets was mixed with Russia reporting robust expansion while China returned to negative territory.

“We are seeing movement in the right direction, particularly in some key domestic markets. But the situation for international travel is nowhere near where we need to be. June should be the start of peak season, but airlines were carrying just 20% of 2019 levels. That’s not a recovery, it’s a continuing crisis caused by government inaction,” said IATA’s Director General, Willie Walsh.

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