FG Moves to End Airlines’ Aircraft Crisis with New Leasing Company
Oru Leonard
The Federal Government of Nigeria has approved the establishment of a national aircraft leasing company aimed at easing the financial burden on domestic airlines, reducing flight disruptions and improving the stability of Nigeria’s aviation sector.
The approval was granted by the Federal Executive Council (FEC) for the creation of a Special Purpose Vehicle (SPV) that will drive the initiative in partnership with international investors and development finance institutions.
Minister of Aviation and Aerospace Development, Festus Keyamo, disclosed this on Tuesday in Abuja during a meeting with airline operators and industry stakeholders.
According to the minister, the initiative is designed to help Nigerian carriers gain easier access to aircraft through local leasing arrangements, thereby reducing dependence on expensive foreign financing and exposure to exchange rate volatility.
He explained that Nigeria’s aviation industry is largely driven by private operators, unlike many African countries where airlines are government-owned or heavily subsidised.
“It is only in Nigeria and the whole of Africa that you have this volume of private operators. Since we do not own a national airline, our duty is to support Nigerian private operators to survive and thrive,” Keyamo stated.
Under the arrangement, the proposed leasing firm will acquire aircraft through funding from international investors, private financiers and African development institutions, before leasing them to Nigerian airlines in naira-based structures expected to lower operating costs.
Keyamo said the government’s role would be to strengthen investor confidence through improved regulatory protections, particularly around aircraft repossession and safety compliance, rather than offering direct sovereign guarantees.
He revealed that the African Development Bank had already adopted Nigeria as one of its pilot countries under a continental aviation financing programme supported by a $7 billion facility.
The minister added that the initiative had begun attracting international attention, with further agreements expected during upcoming aviation engagements in Brazil.
He linked the move to recurring flight delays and cancellations experienced by passengers across the country, noting that many airlines operate with limited aircraft capacity.
“Our approach is not to fight the airlines but to support them with policies that will improve their services. No airline is happy to cancel flights because they lose money when that happens,” he said.
Chief Executive Officer of Ibom Air, George Uriesi, who spoke on behalf of Airline Operators described the initiative as a major boost for the aviation industry, noting that Nigerian airlines had long struggled with extremely high financing costs and poor access to leasing opportunities.
According to him, local airlines often face interest rates far higher than competitors in other countries, making fleet expansion difficult.
He noted that reforms tied to the Cape Town Convention and improvements in aviation insurance were gradually restoring confidence among international financiers.
Industry stakeholders believe the initiative could increase aircraft availability, improve flight reliability and help moderate airfares over time.
Keyamo said incorporation of the leasing company is expected within weeks, while discussions with investors and development partners on full operational take-off are ongoing.
