The Federal Government has declared that it lacks legal authority to regulate or control domestic airfares in Nigeria, citing decades-old deregulation policies that allow private airlines to independently set ticket prices.
Minister of Aviation and Aerospace Development, Festus Keyamo, SAN, made this clarification on Wednesday, December 10, while addressing State House correspondents following the Federal Executive Council meeting presided over by President Bola Tinubu at the Presidential Villa in Abuja.
The statement comes amid widespread complaints from air travelers over what they describe as exorbitant and unpredictable ticket prices that have made domestic air travel increasingly unaffordable for many Nigerians.
However, Keyamo explained that the government’s hands are tied by the deregulation policy introduced during the military administration of former President Ibrahim Babangida, which granted private airlines autonomy to determine their pricing structures.
“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.
The Aviation Minister acknowledged that airline operators face substantial cost pressures that ultimately translate into higher ticket prices, including limited access to aircraft, unfavorable lease arrangements, absence of local maintenance facilities, and the persistent need for foreign exchange to conduct mandatory C-checks abroad.
Despite the government’s inability to directly intervene in pricing, Keyamo announced a significant development that he believes will naturally drive down airfares through market forces.
According to the Minister, a major international aircraft lessor has returned to the Nigerian aviation market after an absence of nearly two decades, resulting in more favorable leasing terms for local carriers.
This breakthrough has already produced tangible results, with one domestic airline securing a dry lease at a rate three times cheaper than previous offers available in the market.
Keyamo attributed the achievement to recent reforms and new practice directions implemented under the Cape Town Convention, which have successfully restored investor confidence in Nigeria’s aviation sector.
The Minister expressed optimism that increased aircraft availability would stimulate competition, which he identified as the key mechanism for reducing fares in a deregulated market.
“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,” Keyamo explained.
He predicted that Nigerian air travelers would begin experiencing the benefits of expanded fleet capacity and heightened competition within the next few months to one year.
On the contentious issue of multiple taxes and charges levied on airlines—a concern recently highlighted by the Economic Community of West African States—Keyamo confirmed that Nigeria had received regional advisories recommending relief measures for operators.
However, the Minister clarified that taxation policy falls outside his ministry’s jurisdiction, making unilateral action impossible.
“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 forwarded operators’ complaints regarding the tax burden to appropriate government authorities and that discussions were currently underway to address the concerns.
The Minister emphasized that while the government remains committed to easing operational challenges facing the aviation industry, it must simultaneously protect revenue streams necessary for maintaining critical aviation infrastructure.
The Aviation Ministry’s position highlights the delicate balance between allowing market forces to operate freely and addressing public concerns about affordability in an essential service sector.
Nigerian airlines have consistently cited high operating costs as justification for elevated ticket prices, pointing to expenses including aviation fuel, foreign exchange volatility, maintenance costs, insurance, regulatory charges, and multiple taxation.
Industry stakeholders have long called for government intervention to reduce the cost burden, arguing that Nigeria’s aviation sector operates under some of the most challenging conditions in Africa.
The return of international aircraft lessors to the Nigerian market represents a vote of confidence in recent policy reforms aimed at making the country more attractive for aviation investment.
Under the Cape Town Convention, which Nigeria has adopted, aircraft financiers and lessors enjoy enhanced legal protections for their assets, reducing risk and potentially lowering costs for local operators.
If Keyamo’s predictions prove accurate, increased aircraft availability could expand route networks, improve schedule reliability, and ultimately benefit consumers through lower fares driven by intensified competition among carriers.
However, skeptics question whether market forces alone will deliver meaningful relief to travelers without complementary government measures to address structural challenges including infrastructure deficits, security concerns, and forex scarcity.
As the government pursues its market-based approach to airfare reduction, millions of Nigerians continue to struggle with ticket prices that often fluctuate dramatically and can exceed monthly minimum wage for popular domestic routes.
The Aviation Ministry’s engagement with airlines and ongoing discussions about tax relief suggest that authorities recognize the severity of the affordability crisis, even if direct price controls remain off the table under current policy frameworks.
