Against the lamentations by air travelers over what they described as outrageous airfare in the country, the Federal Government (FG) stated it lacks the legal authority to regulate or fix domestic airfares because the aviation sector has been fully deregulated for decades.
Minister of Aviation and Aerospace Development, Festus Keyamo, SAN, made this clarification while briefin State House correspondents after the Federal Executive Council (FEC) meeting, presided over by President Bola Tinubu, at the Presidential Villa on Wednesday, December 10.
The Minister explained that the policy of deregulation, which grants private airlines freedom to set their own ticket prices, dates back to the administration of former military president, Ibrahim Babangida.
“Government has absolutely no powers to fix prices for private enterprises. That is what deregulation means. But that does not mean we are leaving the airlines without engagement,” Keyamo stated.
Keyamo acknowledged that operators grapple with significant cost drivers that ultimately reflect in ticket pricing, including Limited access to aircraft, Unfavourable lease arrangements, Lack of local maintenance facilities, the persistent need for foreign exchange to conduct mandatory C-checks abroad.
The Minister noted a major development under the current administration that promises relief: the return of a major international aircraft lessor to the Nigerian market after nearly two decades.
This development has resulted in a dry lease being granted to a local carrier at a rate three times cheaper than previous offers.
Keyamo attributed the breakthrough to recent reforms and new practice directions under the Cape Town Convention, which have successfully boosted investor confidence.
He predicted that this will naturally lead to lower fares: “With cheaper dry leases coming in, more airlines will have access to aircraft. More aircraft automatically means stronger competition. And competition is what brings prices down in any free economy.” The Minister expects passengers to begin seeing the impact of increased fleet capacity within the next few months to a year.
On the issue of multiple taxes and charges—an issue recently flagged by ECOWAS—Keyamo confirmed Nigeria had received a regional advisory urging relief for operators. However, he noted that taxation falls outside the jurisdiction of his ministry.
“I cannot wake up one morning and abolish taxes. These revenues go into the Federation Account. The Finance Minister, the tax authorities, and other stakeholders must all be at the table,” he said.
Keyamo disclosed that he had already escalated operators’ concerns to the relevant authorities and that discussions were ongoing. He added that while the government remains committed to easing industry challenges, it must also safeguard the revenue needed to maintain critical aviation infrastructure.
