The Minister of Aviation and Aerospace Development, Festus Keyamo, has disclosed that the federal government does not have the power to regulate airfares.
Keyamo stated this on Wednesday while addressing State House correspondents after the Federal Executive Council meeting at the Presidential Villa.
He, however, stated that despite the government being unable to dictate prices, it remained actively engaged with airlines to address the underlying factors driving high fares.
Keyamo explained that the deregulation of the industry dated back to the administration of former military leader Ibrahim Babangida, when private airlines were first allowed to operate freely, including setting their own ticket prices.
He said the Senate had summoned him over rising airfares, but he was unable to attend.
The minister, however, disclosed that he instructed the Nigerian Civil Aviation Authority (NCAA) and domestic airlines to appear before the Senate Committee in his absence.
“The government has absolutely no power to fix prices for private enterprises. That is what deregulation means. But that does not mean we are leaving the airlines without engagement,” he said.
The minister said operators had repeatedly raised concerns about access to aircraft, unfavourable lease terms, the absence of local maintenance facilities, and the pressure to source large amounts of foreign exchange to conduct mandatory C-checks abroad, factors that all feed into ticket pricing.
He revealed that one of the most significant breakthroughs occurred recently under the Tinubu administration, when, after nearly two decades of absence, a major global aircraft lessor returned to Nigeria and approved a dry lease for a local carrier at a rate three times lower than previous market offerings.
Keyamo attributed the development to reforms introduced by the Federal Government, including new practice directions on the Cape Town Convention, which protect the rights of international lessors and boost confidence in Nigeria’s aviation environment.
“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,” he said.
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