NAHCo boss calls for synergy between banks and GHCs

Gboyega Adeoye, Lagos

Sule Bates, NAHCo bossTHE Managing Director of Nigerian Aviation Handling Company Plc (NAHCo), Mr. Bates Sarki Sule, has identified several key challenges facing ground handling operations in Nigeria, which Ground Handling Companies[GHCs] and banks need to urgently tackle to achieve a mutually rewarding business relationship.

Speaking on the challenges of financing aviation ground handling operations at a workshop on aviation financing organised by the Chartered Institute of Bankers of Nigeria in Lagos, Mr. Sule identified challenges such as high cost of ground support equipment and insurance claims, the need for a total insurance cover to take care of incidents and accidents which cannot be totally avoided in industry operations, dearth of skilled manpower, the need for full knowledge of the Nigerian business environment and the aviation industry to ensure that financing packages include informed advisory services on safety matters.

Elaborating on the capital-intensive nature of ground handling operations, Mr. Sule disclosed that in the last three years, for example, NAHCo had spent close to N1billion on equipment purchase for its ground handling operations.

This, according to him, was inevitable, considering the sensitive and crucial nature of ground handling operations to the safety of both aircraft and passengers.

In his words, “Ground handling companies play a crucial role in ensuring that flight operations are not disrupted and that passengers have safe and comfortable flights. A delay, an error, or any form of sloppiness arising from mal-functioning ground support equipment or a negligent ground staff can cause massive disruptions and flight cancellations, with consequent revenue loss.”

He therefore advised that financing arrangements should take into account the sensitive nature of the industry and include packages that give premium to safety while acquiring aircraft or any other equipment.

In Mr. Sule’s views, “Aviation financing is not just about committing money and waiting to reap huge returns. It is more of offering financial advisory services and supporting aviation operators in putting safety first while acquiring aircraft or any other equipment.”

Mr. Sule, however, commended recent developments whereby financial institutions were beginning to take an interest in financing ground handling operations. He suggested that financing initiatives should be considered with regards to provision of short-term loans, overdrafts, and working capital; financial advisory/counselling services; finance of outright purchase of new equipment or lease; finance of construction of modern cargo warehouses and other facilities.