US embassy cable - 03ABUJA440

UNCLAS SECTION 01 OF 03 ABUJA 000440 
 
SIPDIS 
 
 
SENSITIVE 
 
 
STATE PASS TO TRADE AND DEVELOPMENT AGENCY 
 
 
E.O. 12598: N/A 
TAGS: EAIR, BEXP, PGOV, NI 
SUBJECT:  NIGERIA: SLOW GOING AT THE MINISTRY OF AVIATION 
 
 
SENSITIVE BUT UNCLASSIFED; PROTECT ACCORDINGLY. 
 
 
1. (SBU) Summary: Ambassador Jeter, accompanied by Econoff 
and USTDA representatives Steingass and Hardy, met with 
Minister of Aviation Chikwe in late January.  Despite 
Nigerian participation at a November 2002 Air Cargo 
Roundtable in Washington, the Minister showed little 
interest in expanding air cargo links between the U.S. and 
Nigeria.  Chikwe lauded her accomplishments since 2000, but 
blamed Nigeria's press and the Bureau of Public Enterprise 
(BPE) for sabotaging her deal to reorganize Nigeria 
Airways.  The Minister said President Obasanjo wanted to 
maintain a national carrier, and supported her ongoing 
efforts to do so.  Chikwe said she had done all she could 
to obtain Category I status for Nigeria, but the National 
Assembly had yet to pass necessary legislation. Steingass 
informed Chikwe that USTDA will likely provide funding to 
DynCorp, a U.S. Corporation, for a feasibility study for 
the construction of a $400 million National Aircraft 
Maintenance Center in Lagos. End Summary. 
 
 
2. (SBU) In late January, Ambassador Jeter, Econoff, and 
USTDA representatives Steingass and Hardy (who were 
visiting Abuja on an assessment visit) met with Minister of 
Aviation Kema Chikwe. The Minister thanked USTDA for its 
support and stated that the U.S. had "done much" in the 
last three years to assist Nigeria's aviation sector. 
Steingass thanked the Minister for sending representatives 
to a late-2002 USTDA/DOT/ExIm-sponsored African Air Cargo 
Transportation Roundtable in Washington. The conference, he 
noted, had brought private sector air cargo specialists and 
U.S. and African officials together to discuss expanding 
links in air cargo service between the U.S. and Africa. 
 
 
3. (SBU) ExIm Director Joseph Grandmaison had written to 
the Ambassador in December 2002 to ask what the GON planned 
to do to improve Nigeria's air cargo connections and had 
met with the Minister and her staff during subsequent 
visits.  During the Ambassador's follow-up meeting with the 
Minister, and during a separate meeting between Econoff and 
Chief I.E. Awodu, the Technical Assistant to the Minister, 
our Nigerian interlocutors admitted that they had given 
little attention to expanding air cargo links with the 
United States.  They argued that without a viable national 
carrier, Nigeria would have difficulty benefiting from 
increased air cargo connections. (Comment: The argument is 
specious in that one private carrier in Nigeria, and 
possibly more, might be capable of ensuring air cargo 
service between the two countries.  The carrier providing 
such a service need not be state controlled.  End comment.) 
 
 
--------------- 
Accomplishments 
--------------- 
 
 
4.  (SBU) During the late January meeting, Minister Chikwe 
listed her accomplishments since assuming office in 2000: 
constructing Abuja's diplomatic hangar, developing gardens 
and planting hedges at the nation's airports, banning 
antiquated aircraft, making the airports more secure, 
refurbishing runways, repairing some radar systems, 
renewing the Zaria pilot training school, and purchasing 
passenger buses to shuttle passengers between aircraft and 
terminals. 
 
 
--------------------------------------------- --------- 
"Nigeria Airways Should Have Been Closed 10 Years Ago" 
--------------------------------------------- --------- 
 
 
5. (SBU) After giving herself credit and noting that 
President Obasanjo supported her, Chikwe lambasted 
Nigeria's Bureau of Public Enterprise (BPE), especially its 
Director General Nasir El-Rufai. She accused BPE of 
sabotaging her efforts at reorganizing Nigeria Airways into 
the newly named Air Nigeria. The Minister said she had 
wanted to broker a deal with the U.K.-based Air Wing, then 
approach Singapore Airlines to partner with the GON in 
lucrative routes to the U.S. and U.K. BPE was not the only 
party that opposed the idea.  Chikwe chided the Nigerian 
press for writing erroneous reports about it, stating "it 
was just blackmail."  She then berated Nigeria Airways 
management for leasing airplanes for its international 
routes, without having the cash to pay the lessors. 
 
 
6. (SBU) Comment: In mid-2002, the Ministry of Aviation 
planned to establish a joint venture with Airwing 
Aerospace, a heretofore unknown U.K. company, which was to 
have bought 49% of state-owned Nigeria Airways.  BPE had no 
prior knowledge of the arrangement.  El-Rufai blocked the 
deal in late September 2002 because, as he stated publicly, 
the arrangement lacked transparency and was really a "give- 
away" of the national carrier.  End Comment. 
 
 
--------------------------------- 
Obasanjo Wants a National Carrier 
--------------------------------- 
 
 
7. (SBU) Minister Chikwe asserted that the Ministry was not 
in a position to shut down the national carrier no matter 
the name since President Obasanjo wanted a national 
airline. Moreover, the BPE can not privatize a bankrupt 
airline with 2,000 employees on the payroll, she said. 
Since the airline should have been closed 10 years ago, she 
recommended to the President that the GON not invest a 
single dollar in Nigeria Airways; the GON should try 
instead to establish a joint venture with credible 
management to ply international routes. (Comment: Why the 
agony should be prolonged remains an open question. The GON 
continues to invest billions of Naira in unprofitable state 
enterprises, such as Nigeria Airways.  Since its 
establishment, Nigeria Airways planes have often flown 
half-full with many non-paying customers.  Still, many GON 
officials including the President believe that a national 
carrier is essential to Nigeria's national prestige and 
identity, and may one day be profitable.  End Comment.) 
 
 
-------------------------- 
Problems and More Problems 
-------------------------- 
 
 
8. (SBU) The Minister claimed that all levels of Nigeria's 
aviation sector need assistance. She said the Ministry 
received many reports from passengers of lost or stolen 
items from personal luggage and cargo shipments at 
Nigeria's airports.  With respect to personnel, she said 
the youngest Nigeria-trained pilot was 40 years old.  The 
National Aviation Training Center in Zaria had not trained 
a single pilot in 10 years, she said. The Ambassador asked 
whether the GON trains pilots abroad.  The Minister replied 
that doing so was too costly. She noted that between 1979 
when Obasanjo gave up power and 1999 when he resumed as 
Head of State, military rulers had not maintained the 
aviation sector. This neglect accounts for the poor 
condition of many of Nigeria's regional airports.  Chikwe 
asked whether USTDA could help train Nigeria's pilots and 
upgrade its radar systems. 
 
 
9. (SBU) Steingass told the Minister that USTDA does not 
provide direct assistance to countries, but provides 
funding for feasibility studies and training related to US- 
based company investments in Nigeria. Chikwe responded that 
she would form a small committee to maintain contact with 
USTDA and to brainstorm about areas where USTDA could 
assist the Ministry. 
 
 
---------- 
Category I 
---------- 
 
 
10.  (SBU) The Ambassador requested an update on Nigeria's 
progress toward Category I status. Minister Chikwe said she 
had done all she could toward that end.  The National 
Assembly must pass the legislation, though nothing will 
likely happen until after the April presidential election. 
(Comment: Nigeria has not met International Civil Aviation 
Organization (ICAO) safety and security standards and 
cannot fly to the United States utilizing its own crews and 
aircraft.  The GON has failed to implement an ICAO 
recommendation that the Director General of the Nigerian 
Civil Aviation Authority (NCAA) be given autonomous 
decision-making authority with respect to aviation safety 
and ancillary regulatory responsibilities. The National 
Assembly is considering legislation that would grant the 
NCAA such autonomy.  But pending legislative action, the 
NCAA remains under the authority of the Minister of 
Aviation.  Even if the legislation were passed, Nigeria 
would fall short of Category I status.  Nigeria lacks 
internationally trained cabin crews and operations 
inspectors, and has no operational aircraft.  End Comment.) 
 
 
-------------------------------------- 
National Aircraft Maintenance Facility 
-------------------------------------- 
 
 
11. (SBU) The Ambassador concluded the meeting by noting 
the huge potential in Nigeria's aviation sector.  Steingass 
added that USTDA had financed a feasibility study of a 
Lagos-based National Aircraft Maintenance Facility in 1990, 
but owing to changes in Nigerian governments, the facility 
was never realized. He added that USTDA is considering 
funding part of a feasibility study by Texas-based DynCorp. 
(At a projected cost of $400 million, the National Aircraft 
Maintenance Center would be the largest in Africa.  Post 
will report relevant developments, via septel.) 
Jeter