The Nigerian Government has taken a significant step to enhance the country’s aviation sector by signing the Cape Town Convention Practice Directions.
The agreement, signed by Chief Judge of the Federal High Court, Justice John Tsoho, during a Presidential Enabling Business Environment Council (PEBEC) meeting at the Presidential Villa, Abuja, marks a pivotal move towards modernizing aircraft leasing practices in Nigeria.
The Cape Town Convention Practice Directions, outlined in Order CTC/2024/114, will enable domestic airline operators to dry lease aircraft, aiming to reduce operational costs for airlines. This regulatory adjustment is anticipated to cut insurance expenses, boost investor confidence, and align Nigeria’s aviation sector with international standards. According to Stanley Nkwocha, Senior Special Assistant to the Vice President on Media and Communications, the new rules are designed to lower the cost of insurance, revive investor trust, and streamline aircraft leasing.
This development follows previous issues where local operators breached the Cape Town Convention, prompting concerns from the Aviation Working Group co-chaired by Airbus and Boeing. The group had threatened to blacklist Nigeria until appropriate legislation was implemented. The signing of the Practice Directions is expected to address these concerns and prevent future breaches.
Vice President Kashim Shettima, who chaired the meeting, praised the signing as a “great day for Nigeria,” emphasizing the administration’s commitment to supporting the aviation industry. He commended Justice Tsoho for his proactive role and highlighted the administration’s dedication to creating a favorable business environment.
Finance Minister Wale Edun also committed to further discussions with airline operators to address ongoing issues and reduce operational costs. He noted that the changes are part of broader efforts to improve the business climate in Nigeria, including strategies to enhance economic stability and growth.
Airline operators, represented by CEO of Air Peace Allen Onyema expressed their gratitude for the new policies, describing the day as historic and transformative for the aviation industry. Onyema highlighted President Bola Tinubu’s efforts in improving the business environment and ensuring that Nigeria remains a competitive and attractive location for airline investments.
Special Adviser to the President on PEBEC and Investment Jumoke Oduwole, echoed the sentiment, stating that the new regulations will alleviate high flight ticket costs and address regulatory challenges. She praised the President for his commitment to easing business operations in Nigeria.
Additionally, Minister of Aviation and Aerospace Development Festus Keyamo represented by Anastasia Gbem, noted that the signing aligns with the Ministry’s goal of bolstering local airlines and reassuring international investors. The Chief Executive Officer of the National Insurance Commission of Nigeria, Olusegun Omoseye, also underscored the importance of the new regulations in advancing Nigeria’s aviation sector and economy.
Overall, the signing of the Cape Town Convention Practice Directions is seen as a landmark achievement for Nigeria’s aviation industry, promising to enhance operational efficiency and attract further investment.
