Commodities

Nigeria picks Egypt Air consortium for aviation venture

Nigeria has selected a consortium including Egypt Air to set up an aviation leasing company as part of a government plan to overhaul the country's aviation sector.

ABUJA, Feb 24 (Reuters) - Nigeria has selected a consortium including Egypt Air [RIC:RIC:EGY.UL] to set up an aviation leasing company as part of a government plan to overhaul the country's aviation sector.

Decades of neglect and a lack of investment have left Nigeria with low-quality infrastructure seen as a hurdle to economic development. The government has said upgrading infrastructure will require private investment.

It has been seeking private partners to set up an aircraft leasing company to help domestic and African carriers obtain new planes.

The Ministry of Aviation said on Monday it has picked the Egypt Air consortium for the aviation leasing company, which the government aims to set up as a private/public partnership.

The new company will initially lease aircraft from international lessors and then lease them on to domestic operators. The government has said it will hold a minority stake in the company.

Most airlines in Nigeria want to expand their fleets, but high financing costs and currency risks have hampered growth. Nigerian airlines' revenues are earned in naira while most of their costs are paid in U.S. dollars.

Nigeria has also said it plans to hand over its airports to private managers as a way to attract investment.

The ministry also said it has short-listed the Egypt Air consortium as well as Ethiopian Airlines [RIC:RIC:ETHA.UL] to set up an aircraft maintenance facility in Lagos or Abuja.

(Reporting by Felix Onuah; Writing by Chijioke Ohuocha; Editing by Hugh Lawson)

((chijioke.ohuocha@thomsonreuters.com; +234 703 4180 621; Reuters Messaging: chijioke.ohuocha.thomsonreuters@reuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Latest Markets Videos

    Reuters

    Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV.

    Learn More