Chief Executive Officer of Air Peace and Vice Chairman of the Airline Operators of Nigeria (AON), Allen Onyema, has called for a reform of Nigeria’s aviation financing framework, stressing the need for both government support and industry self-discipline.
Onyema spoke as one of five panelists at the 29th Annual Conference of the League of Airport and Aviation Correspondents (LAAC) held in Lagos, themed “Financing Aviation in Nigeria: Risks, Opportunities and Prospects.” Other panelists included aviation consultant Chris Aligbe, Bi-Courtney COO Remi Jibodu, FAAN’s Director of Finance Ayodele Olatiregun (representing Managing Director Olubunmi Kuku), and CITA Energies CEO Dr. Thomas Ogungbangbe.
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Funding as the Industry’s Albatross
Onyema described aviation as a capital-intensive sector weighed down by crippling financing terms in Nigeria. While airlines in the United States and Europe secure loans at interest rates between 2–5 percent, Nigerian carriers are charged as high as 35 percent—often with extreme collateral demands.
“You can be asked to dig up your grandmother’s grave or sell your entire village as collateral,” Onyema said. “This is why Nigerian airlines struggle. The conditions given by financial institutions are far from supportive. Aviation here has become an act of self-sacrifice.”
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The Integrity Problem
Onyema linked the harsh lending conditions to Nigeria’s history of poor financial accountability. “Banks insist on taking everything you own before lending, because in the past, people borrowed and never repaid, leading to collapsed banks,” he explained.
He urged operators to embrace financial discipline:
> “We must start with self-introspection. At Air Peace, we earned the trust of our banks through integrity and discipline. Today, I can call any of them for support without mortgaging my life’s work. If every operator shows that kind of responsibility, financing will gradually become more accessible.”
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Role of Government
While acknowledging challenges, Onyema commended the Federal Government for recent reforms, including efforts to stabilize foreign exchange and introduce dry leasing opportunities for Nigerian airlines.
“The government has given us a chance to plan by stabilizing forex, and the dry lease option is going to be a game-changer,” he noted. He praised President Bola Tinubu and Minister of Aviation Festus Keyamo for creating a more business-minded policy environment.
However, he urged more support in the form of single-digit interest loans, dollar access windows, and government-backed guarantees. “If airlines in Nigeria can borrow at single-digit interest rates, no airline will fail in this country,” Onyema asserted.
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Breaking the Stigma
Onyema also revealed that Nigeria had been “unofficially blacklisted” in global leasing markets due to past defaults. This, he said, explains why the country had gone 12 years without accessing dry leases.
“For the first time in over a decade, Nigeria will, in two weeks, receive its first dry-leased aircraft. Big global airlines operate hundreds of aircraft this way. It is unsustainable to depend only on wet leases,” he stressed.
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Airlines’ Own Responsibility
Beyond government action, Onyema emphasized that operators must carefully evaluate their business models. “Before borrowing, ask: are you running a premium airline or a budget carrier? Do you have reliable data to back your plan? Borrowing beyond your means is a recipe for failure.”
He backed government plans to establish a national leasing company that would provide aircraft to Nigerian airlines at affordable rates, describing it as another positive step.
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Conclusion
Allen Onyema’s message to the aviation sector was clear: while government reforms and supportive financing are crucial, the industry must also purge itself of financial recklessness. “With discipline, transparency, and liberalized funding at single-digit rates, Nigerian airlines will not only survive but thrive,” he declared.
