Government announces plan for establishing new airline
On Wednesday, February 7, 2018, the Federal Executive Council (FEC) approved Airline Management Group (AMG) to work on the establishment of a new national carrier.
This was disclosed by the Minister of State, Aviation, Hadi Sirika when he briefed State House correspondents at the end of the weekly FEC meeting in Abuja.
In May 2017, the government appointed Messers Lufthansa consortium and five other advisers to help it set up a national airline and develop its aviation infrastructure.
Sirika said, “Today Council considered a memo from transportation regarding aviation. It was a memo that was brought to substitute a member of the consortium that will provide transaction advisory services for the establishment of a National career. And that member of the consortium is Messers Lufthansa consulting.”
“Council considered and approved that substitution with another company called AMG (Airline Management Group) with Avia Solutions GE to join the other members of the consortium to continue providing the same services at the same cost; this is the only substitution.’’
The minister explained that substitution was made in the wisdom of the council because they felt that Lufthansa consulting is an appendage of the airline group and that might bring the conflict of interests.
“Lufthansa themselves may want to join, partner or help in the process during the procurement phase of this transaction. And of course they are members of Star Alliance, members of One World and members of Sky team, others may feel shortchanged.”
“Most of them have produced the outline business cases and we are on our way to doing the full business case. However, Lufthansa Consulting did not accept the offer neither have they signed any contract.”
“They countered the offer instead. One of the conditions is that we should pay them 75% of the total cost, which is against our procurement law. They also wanted us to change the contract from Naira to Euro, they also wanted us to open an Escrow account in an internationally recognized bank outside the country where the money will be domiciled etc.”
The Minister explained that they could not continue business with them because it will compromise the system which they thought should be transparent which led to them seeking the approval of the council to substitute them.