Travel News

By Reuters Staff

(Reuters) - People can pay for a slushie with crypto in the streets of “Bitcoin Valley,” a project in the Honduran tourist enclave of Santa Lucia through which the country has entered the digital currency trend.

The small town in the mountains, 20 minutes from the capital Tegucigalpa, has become a bitcoin city.

Owners of businesses big and small in Santa Lucia are adapting to handle cryptocurrencies as payment, hoping to attract more tourism.

“It will open more opportunities and attract more people who want to use this currency,” said Cesar Andino, manager of Los Robles shopping square.

The “Bitcoin Valley” project targets 60 businesses to initially get trained and adopt cryptocurrencies to market their products and services, expecting to spread these practices to more enterprises and nearby areas.

The initiative was jointly developed by the Blockchain Honduras organization, the Guatemalan cryptocurrency exchange consortium Coincaex, the Technological University of Honduras and Santa Lucia’s municipality.

Ruben Carbajal Velazquez, professor at the Technological University, said “Santa Lucia’s community will be educated to use and manage cryptocurrencies, implementing them in different businesses in the region and generating crypto-tourism.”

While some Latin American countries are exploring cryptocurrencies’ potential, there are risks.

In September 2021, El Salvador adopted bitcoin as legal tender having its own ‘Bitcoin Beach’ in the surfing hotspot town of El Zonte.

The Central American country’s bet on bitcoin was hampered by the crypto market downturn and skepticism from multilateral lenders and ratings agencies. Its publicly disclosed holdings of $105 million are now worth about $57 million.

To deal with volatility, the Honduran “Bitcoin Valley” will “enable merchants to receive instant payments in the local currency, eliminating cryptocurrencies fluctuation risks,” said Leonardo Paguada, founder of the Block Chain Honduras organization.

Critics of bitcoin’s expansion have warned that these kind of operations may fuel money laundering and financial instability while enhancing the digital gap, as poorer parts of society may struggle to access the technology.

Reporting by Rodolfo Penaroja and Aida Pelaez-Fernandez; Editing by David Gregorio

The airline says it has been able to repatriate funds amid Nigeria's dollar shortage.

By Abdulkareem Mojeed

Emirates Airlines says it will reduce the number of flights to Nigeria from August 15 due to failure to repatriate its revenue from the country.

The airline disclosed this in a letter dated July 22 addressed to Nigeria’s Minister of Aviation, Hadi Sirika, and signed by its DSVP International Affairs, Majid Al Mualla.

“With effect from 15 August 2022, Emirates will be forced to reduce flights from Dubai to Lagos from 11 per week to 7 per week. We have had no choice but to take this action, to mitigate the continued losses Emirates is experiencing as a result of funds being blocked in Nigeria,” the letter partly read.

The letter noted that as of July, Emirates had $ 85 million of funds awaiting repatriation from Nigeria. It said the figure has been rising by more than $10 million every month, while operational costs of 11 weekly flights to Lagos and five to Abuja continue to accumulate.

The airline said these funds are urgently needed for them to meet their operational costs and maintain the commercial viability of our services to Nigeria.

“We simply cannot continue to operate at the current level in the face of mounting losses, especially in the challenging post COVID-19 climate,” the airline noted.

According to the Bilateral Air Service Agreements (BASAs) with countries, airline tickets are mostly sold in naira while the airlines would repatriate the funds in dollars through the country’s central bank.

Efforts made so far

Emirates said it tried to stem the losses by proposing to pay for fuel in Nigeria in Naira, which would have at least reduced one element of its costs, but that the request was denied by the supplier.

“This means that not only are Emirates’ revenues accumulating, we also have to send hard currency into Nigeria to sustain our own operation. Meanwhile our revenues are out of reach and not even earning credit interest,” the airline added.

The airline said, “Your Excellency, this is not a decision we have taken lightly. Indeed, we have made every effort to work with the Central Bank of Nigeria (CBN) to find a solution to this issue.”

It said, “Our Senior Vice-President met with the Deputy Governor of the CBN in May and followed up on the meeting by letter to the Governor himself the following month, however no positive response was received.”

The letter also explained that meetings were also held with Emirates bank in Nigeria and in collaboration with the International Air Transport Association (IATA) to discuss improving Forex allocation, but with limited success.

The ariline requested the government to help resolve the problem. Nigeria is facing a foreign currency crunch with amid low oil revenues and rising demand for dollars. Naira sold for N700 a dollar on Friday at the parallel market, about its worst performance.

“Should there be any positive development in the coming days, we will of course re-evaluate this decision,” the airline noted.

When PREMIUM TIMES reached out to a Special Assistant to Mr Sirika, James Odaudu, for comments he said, “ I am not in the mood to talk to you now.”

While Nigeria grapples with forex scarcity as demand increases, domestic airline operators within the past weeks and months have lamented the sudden increase in aviation fuel, threatening to halt operations.

Mr Sirika on Tuesday during an emergency meeting with airline operators, said, “there are no immediate solutions” to the lingering crisis in the sector because what ails the industry is a global problem.

IAG, the parent of British Airways, has called the recent travel chaos at London’s Heathrow Airport “acute” as the industry has struggled to keep up with demand after the end of Covid restrictions sparked an unprecedented travel boom.

It said overall passenger capacity would not reach full strength for the rest of the year “mainly due to the challenges at Heathrow”, with full-year levels expected to be at around 78% of 2019 levels. It cut its guidance on capacity in the second half of the year by 5% after the west London hub ordered airlines to stop selling tickets for the peak summer travel period.

“Our industry continues to face historic challenges due to the unprecedented scaling up in operations, especially in the UK where the operational challenges of Heathrow airport have been acute,” said Luis Gallego, chief executive.

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Gallego’s comments were more measured compared with a furious war of words over the causes of the chaos. Two of the biggest names in the industry -- the former Heathrow chairman Sir Nigel Rudd and Willie Walsh, who ran BA -- blamed each other’s former companies in a public clash involving letters to the press. Rudd said Walsh had a cost-cutting obsession, leaving the airline a “laughing stock”, while Walsh called Heathrow’s management “a bunch of idiots.”

Dubbed the flightmare by frustrated passengers caught up in late-cancellation chaos, airports across Britain have struggled with staff shortages after the end of Covid travel restrictions.  Heathrow’s move to minimise short-notice disruption by stopping further ticket sales until mid-September shocked the travelling public and the industry alike in July.

BA’s capacity at the west London hub was limited to 69% in the second quarter and will only reach around 75% in the third quarter, according to the company. It is a different story for IAG in North America, where it said it expects to return “close to 2019 capacity” by the end of the year.

In 2019, BA’s Terminal 5 base at Heathrow handled between 550 and 600 weekday flights and around 90,000 customers a day and at the peak of the busy school summer holidays, more than 100,000 customers used the facilities each day.

“We will continue working with the industry to address these issues as aviation emerges from its biggest crisis ever,” said Gallego. “Although bookings into the fourth quarter are seasonally low at this time of year, we are seeing no signs of any weakness in demand.”

Overall, the sharp rebound in demand helped IAG return to quarterly profit for the first time since the pandemic in the three months to the end of June. The company, which also runs Spain’s national airline Iberia, reported an operating profit of €293 million (£245 million) for the second quarter, up from a loss of €967 million (£809 million).

• Oil traders are flocking to India to sell discounted Russian crude, according to a Bloomberg report.

• Small international traders have been selling barrels of Russian crude at an $8 markdown.

• Sri Lanka has turned to international traders as well, receiving a shipment of Russian oil in May and then purchasing more in July.

A hoard of small, lesser-known oil traders are flocking to India to sell Russian crude, according to a report by Bloomberg, offering steeper discounts and new ways for Indian buyers to purchase supplies rejected by the West.

India has already been purchasing Russian crude at a markdown amid Western sanctions, making the country one of Russia's largest oil buyers since its invasion of Ukraine.

While its demand for Russian crude recently declined, Indian buyers are working with small and little-known oil trading companies, which are selling Russian crude at even lower costs.

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Sources told Bloomberg that some international traders have been offering barrels at markdowns of about $8 and that state-run refineries like Indian Oil are considering deals as they require less red tape than buying directly from Russia.

Sri Lanka has turned to international traders as well, receiving a shipment of Russian oil in May and then purchasing more in July, Bloomberg reported.

Aircraft giant, Boeing has raised concern over the dearth of pilots, technicians, and cabin brew as the plane maker In its 2022-2041 Pilot and Technician Outlook says Africa is set to need 20,000 pilots, 21,000 technicians, and 26,000 cabin crew.

According to the PTO, Africa is set to need 20,000 pilots, 21,000 technicians, and 26,000 cabin crew. Meanwhile, China will require 126,000 pilots, 124,000 technicians, and 162,000 cabin crew.

The European market demand for pilots is estimated to reach 122,000, 120,000 technicians, and 207,000 cabin crew, while the Latin American market will need 35,000 pilots, 35,000 technicians, and 48,000 cabin crew.

For the Middle East, 53,000 pilots, 50,000 technicians, and 99,000 cabin crew will be needed compared to 128,000; 134,000, and 173,000 respectively in North America and 22,000, 24,000 and 38,000 in Northeast Asia.

Furthermore, Oceania will require 9,000 pilots, 10,000 technicians, and 18,000 crew members, compared to 37,000, 34,000, and 43,000 in South Asia and 50,000 pilots, 58,000 technicians, and 85,000 crew in Southeast Asia.

In Nigeria, the scarcity of skilled manpower to replace the aging workforce is putting the country’s aviation industry on the edge as the Nigerian College of Aviation Technology, Zaria trains professionals yearly without companies to engage them for their services, according to Aviation Metric.

Aside from Nigeria, the global aviation industry is facing a similar problem. A widespread deficit of pilots across all continents has affected the sector, particularly in recent years, with cases of pilot shortages regularly occurring.

Nigeria’s case is ironic because while so many young pilots and aircraft engineers are seeking to fly for airlines, airline operators are looking for very experienced pilots and engineers who are not being replaced.

The shrinking size of aircraft in the fleet of airline operators has forced many Nigerian pilots to seek greener pastures outside the shores of Nigeria.

The shortage of aircraft engineers for many operators of Maintenance Repair Overhaul in Nigeria has led to a capacity deficit and as such has led to the commensurate expansion of many of the nation’s MRO operators.

Boeing in its projection estimates that 602,000 pilots, 610,000 maintenance technicians, and 899,000 cabin crew members will be required to operate the global commercial fleet set to nearly double to 47,080 aircraft by 2041.

The aerospace and defence giant, Boeing projected an increased demand for 2.1 million new aviation personnel over the next 20 years to support the commercial aviation sector’s steady recovery and meet the anticipated surge in demand for air travel over the forecasted period.

Boeing estimated that 602,000 pilots, 610,000 maintenance technicians, and 899,000 cabin crew members will be required to operate the global commercial fleet set to nearly double to 47,080 aircraft by 2041.

This year’s projections surpass 2021 estimates by 3.4 per cent, excluding the Russian Federation in line with the Western sanctions forbidding aircraft exports to the transcontinental country.

China, Europe, and North America collectively represent more than 50 per cent of the total global demand for aviation professionals, with Africa, Southeast Asia, and South Asia taking the lead as the fastest-growing markets expected to grow by four per cent over the projected period.

“As the commercial aviation industry recovers from the pandemic and plans for long-term growth, we anticipate a steady and increasing demand for aviation personnel, as well as the ongoing need for highly effective training,” Boeing Global Services’ Vice President of Commercial Training Solutions, Chris Broom said, stressing that the company’s customer-centric approach and digital expertise include a commitment to delivering data-driven, competency-based training and assessment solutions as well as technologies that meet customers’ evolving needs.

The Director-General, International Air Transport Association, the Switzerland-based air transport body, Willie Walsh, speaks on the challenges and prospects of the global airline industry at the recently concluded 78th Annual General Meeting and World Air Transport Summit in Doha, Qatar. OYETUNJI ABIOYE was there

When do you think African airlines will recover?

African airlines will recover in 2023 and 2024. Looking at the momentum, full recovery will be in 2024. At the global level and as an industry, it will be in 2023 but the basis is not the same everywhere. The US is back to recovery already; the US domestic market is back to what it was in 2019. It very much depends on the market. Markets with big domestic elements are recovering faster. Russian domestic market was way ahead before 2019, before the war in Ukraine. The Chinese domestic market has been recovering strongly but obviously disrupted by the closure in Beijing. If you look at Africa, it is principally an international market and therefore, the small domestic market is picking up because of all the travel restrictions that are been removed. The recovery in Africa has seen a slower pace than in other regions in the world.

How would you react to the slow vaccination in Africa compared to the rest of the world?

We have been saying for some time that the speed of recovery has been a high level of vaccination. The vaccination in Africa has been slower than in the rest of the world. They have not been going at the same pace.

African governments have blocked international airlines from repatriating over $1bn in ticket sales proceeds. What other ways do you think airlines can get these funds from the African governments?

We are looking at ways to get these funds out. It is really having an impact on the airlines and the recovery of the market as well because airlines will be reluctant to bring capacity into markets where they can’t repatriate their money. It affects national growth and additional capacity. If you can’t get your money out, I am sorry, it is a simple business decision, you are not going to give additional capacity to the market. Airlines are looking to recover their money and they are not going to put their funds into markets that they have no confidence in. I think this is a significant factor against recovery in the continent. It is unfortunate because it would affect the consumers, they are not going to get the choice, they are not going to get the competition and they would not be able to get the choice that they have been getting if the funds were not blocked. They are big issues, really big issues.

Post-COVID-19, most countries suffered fiscally; some governments in Africa applied to the IMF and some think they could hold on to airlines’ funds. What steps do you think IATA is taking to ensure other countries do not follow such a path?

All we need to do is to make it clear to people that it will have consequences. The idea that the industry went into bankruptcy because of closures and still lost a huge amount of money doesn’t work that way, and that does not allow them (African governments) to keep airlines’ funds.  Airlines are not rich. We don’t have a lot of cash. If all people do is undermine the recovery in the industry, it is going to have a direct impact on the services that they give.

There is a discrepancy in the IATA and the Central Bank of Nigeria’s exchange rates; this creates a ‘fight’ all the time between travel agents and the public. How do we solve this problem in the area of the exchange rate?

It is impossible to solve because these differences have existed forever. I honestly don’t see a simple solution to that. It could be good if it is made to be aligned or closely aligned. You are right. In some cases, the difference is significant. I don’t see a simple solution to it.

I am actually concerned about skyrocketing Jet A1 which is taking a toll on not only African airlines but global airlines. Could you tell us how this is impacting the operations of African airlines and how they can mitigate this?

It has a serious impact on the airlines and the price of basic commodities. The oil Brent benchmark that we use is very much influenced by what is happening in Ukraine-the sanctions against Russian oil-and that has driven up the price of oil quite significantly. The second aspect is the difference between a barrel of Brent and a barrel of JetA1 and the lack of capacity in refining. There was little demand for Jet A1 during the pandemic, obviously because the value of the activities by airlines had reduced. We switched attention away from Jet A1 to other products. It is not easy for them to switch back. You cannot just do it overnight. So, we need to see a return to refining capacity. The 10 years between 2010 and 2019, Brent averaged $80 per barrel and 17 per cent on average. Jet fuel was about $93, $94 per barrel. We are looking at an average cost of 25 per cent basic at $100 on average. So, Jet A1 is $125. Brent jumped from $80 to $100. Both of these have increased and both of these have an impact. In the same period, fuel represents 20 per cent of the industry cost base. In that ten-year period in the history of the industry, the average cost was five and a half per cent. Airlines do not have big profit margins and ultimately, these prices are passed on to the consumers on ticket prices. No one is avoiding that if your biggest cost escalates. The industry cannot absorb this that is why you are seeing (the high) ticket prices. Ticket prices would be highly influenced by supply and demand, and in certain cases, the pace at which demand has recovered has been faster than the pace at which supply has returned to the market; and that clearly leads to pushing prices up.

In what ways do you think African airlines and governments can tap into sustainable aviation fuel?

I think it is a huge opportunity for African countries. They do not need to rely on oil and gas to be extracted. You develop Sustainable Aviation Fuel (SAF) which is in huge demand. You have invested in the production facilities and refining capacity. This will help you to reduce your dependence on imports for Jet A1. I genuinely believe that if I was a politician, I will be looking at this huge opportunity because you have the feedstock. You can actually generate sustainable fuel from multiple sources, generate new jobs and you will be able to generate a product that you can sell and help the environment as well. If ICAO is saying this to African countries, I will be saying it as well. There is no risk because the airline industry would need to save fuel. The demand for this product is huge. The demand will continue to increase in the next 10, 15 years. People are looking at opportunities to make investments. It is a great opportunity.

How do you think this can affect the future of African airlines?

The issue of SAF is not just an African issue for African airlines; our strong belief is that SAF can be produced in Spain, exported to Africa. You add that to the transport cost, the carbon footprint of transporting it, it would be more useful to produce SAF in Africa. It does not only constitute a challenge for African airlines, it is a challenge for many airlines across the world. I also think it is a huge opportunity for governments and countries across the world.

Do you subscribe to a bailout for African airlines and the aviation industry?

Yes, I welcome a bailout but the problem I have with a bailout is that it is not sustainable in the long-term and it kills the innovation that is necessary. It helps airlines to navigate any crisis but it is not the most sustainable in the long term. They delay the restructuring or the needed innovation by airlines because you have got a temporary reprieve. If you don’t take the advantage of temporary reprieve, you will just be back in crisis. The only way you can guarantee your future is to drive innovation and efficiency and to make sustainable true economic planning. It is not just African countries but the African countries contribute most significantly to the industry’s platforms.

Some African governments are looking at airport concession and privatisation. What do you think about this?

The only thing we can do is try to convince governments to face up to the responsibilities that they have. We have seen airlines whose funds were trapped completely leave the country like Venezuela. The rest that did not stop significantly reduce the capacity to the country and restricted sales. We can’t advise the airlines on what they should do. That is the decision for the airlines to take. Airports that are privatised do not guarantee a return because they are just going to drive costs, you are preventing innovation because it is going to just guarantee returns.

Most African countries are planning to set up national airlines, what is your take on this?

Airlines can be created by anybody at any time. We have had very successful airlines and unsuccessful airlines. I will never say to people don’t do it because definitely, you know what the challenges are.

The Single African Air Transport Market (SAATM) is a project of the African Union to create a single market for air transport in Africa. SAATM and air liberalisation has been described as a game changer in Africa. What specifically is IATA doing in conjunction with African Civil Aviation Commission (AFCAC) in realising this goal?

The SAATM has to be an opportunity, It has to do with deregulation that has benefitted consumers in other markets that had been deregulated. Europe is a great example of that. So, it gives a massive increase in connectivity, an increase in the number of flights, increases in the number of activities, and much better competition. The consumer wins. This will benefit the African consumers, the connectivity which has a huge benefit for the industry and the economies; it is the right way to go. A fragment of the market will not be sufficient as a single, open competitive market. We still have the US domestic market as a single, open competitive market which is a deregulated market; you have new entrants taking advantage of new opportunities and fantastic for consumers. I think African economies have to concentrate most on what would benefit them from the market.

AIR travellers have begun groaning bitterly under the prohibitive fares airline operators have rolled out for flights within Nigeria as a one-hour flight now costs over a hundred thousand (N100, 000) naira.

When The PUNCH visited the domestic wings of the Lagos airport on Tuesday, many of the travellers lamented the sharp increase in airfares.

An investigation by our correspondent revealed that economy class domestic tickets from Lagos to Abuja via Arik Air, United Nigeria and Air Peace as of the time of filing this report cost over N150,000, while other airlines have since followed suit.

An angry traveller who gave his name only as Ubong and claimed to have been a frequent traveller said, “This is not the time to ask for my name, the Federal Government and all those concerned should do the needful. Why does the average Nigerian have to suffer? I mean, we are an oi producing nation, why are we suffering?

“Everybody is just doing as they like, how can you say Lagos to Abuja is N154,000? Am I plucking money from the tree? The roads are not safe, so travel by road and get kidnapped. Those that were kidnapped inside the train,  many months ago, are still in captivity. Which account will I write this expense?”

Another traveller who said she had to make the trip as she was going on business said, “The Nigerian travelling populace is made up of mostly business people, should we now spend all our earnings on air transport? I can’t even begin to explain how this makes me feel.”

It was learnt that the increase in the price of aviation fuel (Jet A1) as well as its scarcity is a contributory factor to the hike in fares.

A litre of Jet A1 that was selling for N400 now sells for over N800 per litre. The airlines have also complained about difficulties in getting forex.

Despite a significant increase in domestic air passenger traffic in 2019 by almost 30%, there is still a huge gap in travel demand by Nigerians. According to the figures released by the Consumer Protection Directorate of the Nigerian Civil Aviation Authority, roughly 15 million air travellers both domestic and international went through the airports in 2018.

The umbrella body for domestic airlines in the country, Airline Operators of Nigeria, had a few days ago notified passengers of air transport services that the sector had been hit by a major crisis of acute scarcity of Jet A1, thereby warning them of possible flight cancellations and hike in airfares.

An obviously stressed air passenger who gave her name as Jessica Joseph said, “This just means things are getting out of hand, because how do you explain this? Who do we hold responsible now? Our leaders, the cause of all this, have money to fly around as they like, their jets are fully powered on taxpayers’ money yet it is the taxpayer that is suffering. Imagine, what if I now want to fly out of Nigeria, na to rob bank o, abi?”

The last person The PUNCH spoke to was a man who had his luggage strapped to his shoulders, sweating and cursing no one in particular. On approaching him, he insisted on speaking only on condition of anonymity. He said, “I came here today hoping I could fly my family of four from Abuja to Lagos for the Summer holidays but here I am, confused, I’m not even sure I want to go to Abuja again. I’m just grateful I had not rushed to tell my children my plan else I don’t know what I would have done. Something has to be done to salvage this situation, urgently too.”

From endless queues to cancelled flights and lost luggage – if you've experienced any of the chaos plaguing European airports this summer, it might help to imagine a future in which international travel is smoother and doesn't revolve so much around flying.

Picture this: the year is 2045. You’re standing on a platform in Berlin awaiting a sleek Hyperloop pod that will glide into the station to a noiseless halt and then deposit you in Paris an hour later, ready for your morning meeting.

In the afternoon, you’ll take another southbound pod on a leisurely trip to Barcelona for the weekend, a journey that will take no more than 90 minutes.

The speed and ease is no longer a surprise to you, because in the last quarter-century, almost all travel throughout Europe has shifted from the skies to the ground.

Short-haul flights are nothing but a relic of a carbon-fuelled past.

It might seem like the stuff of science fiction, but there are real reasons to believe that a future of mobility like this could be possible.

The climate crisis is focusing the minds of European policymakers on their stated goal of carbon neutrality by 2050. Many are betting on rail to get us there.

Why isn't rail the go-to choice for European travel?

"If we want to achieve decarbonisation and the climate change targets, rail is the instrument to achieve it," Carlo Borghini, the head of Shift2Rail, the EU body responsible for driving research and innovation in the rail sector, told Euronews Next.

Trains already boast impressive green credentials when you factor in their high degree of electrification relative to other transport modes. As it stands, they’re responsible for a mere 0.5 per cent of carbon emissions within the EU.

Still, if Europe wants to cut transport-related emissions – which account for around a quarter of total EU greenhouse gas emissions – there is a long way to go in encouraging passengers and freight off aircraft and into train stations.Despite the continent’s deep experience in the sector and advanced rail networks, only about 7 per cent of passengers and 11 per cent of goods travel by rail.

This can be attributed to the fact that rail in Europe is little more than a patchwork of different national systems that has seen little in the way of a comprehensive Europe-wide strategy, according to a report by environmental think tank Germanwatch.

The result is that cross-border train travel can be an expensive, unreliable, and inconvenient alternative to flying for many.

For example, there are currently no direct train services linking Berlin and either Brussels or Paris, though a TGV Paris-Berlin is due to launch at the end of 2023, with the journey expected to last seven hours.

A Single European Railway Area

The good news, however, is that in the wake of COVID-19, priorities are shifting and there is a real appetite and political momentum to change this state of affairs.

The European Commission plans to double high-speed rail traffic by 2030 and triple it by 2050, and last December it unveiled an action plan including faster trains, simpler ticketing systems and support for cross-border trips.

Shift2Rail aims to establish a Single European Railway Area (SERA). It’s an idea designed to enable seamless cross-border mobility on the continent and simplify the network for rail operators.

We need to ensure that we have in Europe one single European network, meaning that our objective at the end is to transport goods from one side of the continent to the other.

"We need to ensure that we have in Europe one single European network, meaning that our objective at the end is to transport goods from one side of the continent to the other," said Borghini, Shift2Rail's executive director.

"At the same time, we need to ensure the same for the passenger, in order to ensure that any train operator, any railway undertaking can operate trains in each part of Europe without the need to make changes to the locos, to the wagons, to the power, and to the signalling system".

Beyond SERA, Shift2rail is drawing on around €1 billion in funding to help drive innovation towards three specific goals: lowering the life-cycle cost of the rail system, doubling the existing capacity, and reducing delays in the network.

But in the next stage, Borghini tells Euronews, it will be up to member states to decide on the tech solutions they want to fund.

"The next step is to bring rail research innovation to the market: investing in technological solutions that need to be both deployed, migrated... transforming the concrete system," said Borghini.

MagLev trains and Hyperloop

If there’s one thing that could lure passengers to trains, it’s likely the tantalising possibility of drastically reduced travel times between major European cities at zero emissions.

Companies like Nevomo in Poland and Zeleros in Spain are working towards making this a reality by developing respectively a hi-tech maglev rail system and a scalable Hyperloop system.

"Hyperloop is a new way of transport that basically reduces friction, which is the main source of inefficiency in transportation," said Juan Vicén Balaguer, the co-founder and Chief Marketing Officer of Zeleros Hyperloop.

"The two main frictions are the aerodynamics: when the vehicle moves there is some resistance of the air. And the other one is the ground friction that happens when a wheel touches the ground," he explained.

"In order to avoid that. We put the vehicle in a tube where we eliminate most of the air and on the other side we make the vehicle levitate so it doesn't touch any ground. We reduce the main friction and we can work with five to 10 times more energy efficiency than an airplane".

The Hyperloop concept has its roots in the early 19th century, when mechanical engineer George Medhurst first proposed a method of conveying people and goods using pneumatic tubes.

But it was Elon Musk who breathed new life into the idea when he released an open-source concept for a Hyperloop mass transit system in 2013.

In fact, Zeleros began as a university project competing in a Hyperloop Design competition hosted by Musk’s SpaceX in 2015, where they walked away with two awards for best design and best propulsion system.

Encouraged by their success, the team decided to go into business. They now boast a staff of over 150 people and are at the stage of testing the prototype they have developed.

The aim is to achieve speeds of 1,000 km at zero emissions.

Magrail

In the case of Nevomo, while their stated aim is to eventually develop their own Hyperloop prototype, in the short term they are focusing their attention on developing a "magrail" system that they say could be operational by 2025.

"We are orienting at something else in between because Hyperloop is still going to take some time to get implemented," Nevomo’s Business Development Director Milan Chromík told Euronews Next.

"We expect it in a couple of decades. But in the meantime, we understand very much that even the current infrastructure needs to be modernised".

Nevomo’s system is based on magnetic levitation technology which uses magnets to elevate a train off the track and another set of magnets to propel it along the track.

Crucially though, the company is combining this technology with traditional rail by adding the magnetic components and guidance rails to the existing infrastructure, a feature it believes gives Nevomo a distinct advantage over its competitors.

The company recently signed an agreement with the Italian Railway Infrastructure manager Rete Ferroviaria Italiana to verify the technical and economic feasibility of superposing magrail technology over existing tracks.

Together they will apply for European funding to carry out a full-scale trial of the technology at the test circuit at Bologna San Donato.

The European Union is quite pushing now to eliminate short-haul flights within Europe, and they would love to put it on the rails, but on the rails, there is no place to do so. So there needs to be a change in the railway industry to be able to meet those needs.

According to Chromik, the Nevomo magrail tech, if applied to high speed lines, would be capable of doubling the top speeds of a TGV train to 550 km/h.

Another benefit of the tech is that it is able to send individual "pods" to a final destination instead of long trains, something Chromík suggests will increase the capacity of existing lines.

"Nowadays, the current systems, they have come to their limits, and on the most populated, dense lines you are not able to increase traffic anymore," he said.

"The European Union is quite pushing now to eliminate short-haul flights within Europe, and they would love to put it on the rails, but on the rails, there is no place to do so.

"So there needs to be a change in the railway industry to be able to meet those needs".

• Air Peace, Arik, Azman operate at 38.8% fleet capacity
• Hurdles for air travellers as over 30 per cent are underserved
• Operators blame lack of foreign exchange for maintenance
• Sirika’s Aviation Roadmap fails to deliver on promises seven years on
• Industry needs new policy direction to survive, stakeholders say
• Only four of 22 airports are viable, turn others to shopping malls, Bernard tells FG

Beyond the withdrawal of services by two scheduled carriers, the entire local aviation sector may be in for a shutdown of operations over steady loss of fleet capacity that has made schedule reliability near impossible.

Findings by The Guardian showed that the eight active airlines are operating a cumulative 38.77 per cent fleet capacity, with a total of 60 out of 98 listed aeroplanes grounded, pending the availability of foreign exchange earnings to defray maintenance cost.

This is just as an aviation sector stakeholder, Mr. Bankole Bernard, suggested, yesterday, that 18 unviable airports in the country should be turned into shopping malls to generate revenue. According to him, only four airports – Lagos, Port Harcourt, Abuja and Kano – out of 22 airports in the country are viable. The operations of the other 18 airports had been unviable over the years, he noted.

Across the network, rail and road-shy travellers are not finding succour in air transport either. Flights to their destinations are either scarce or available seats are way too expensive, coupled with poor schedule reliability that routinely keeps checked-in passengers stranded in packed terminals.

Stakeholders acknowledged the dire straits of the local operating environment. They blamed the lack of a buffer on the absence of a sustainable aviation development policy.

Most conspicuous is the Aviation Roadmap initiative of the current administration, which has failed to deliver at least one of its promises in seven years.

A painstaking look at the ramp of Lagos Airport at the weekend suggests an industry that is winding down. Grounded aeroplanes are fast taking the parking spaces meant for operating aircraft. And further inquiries confirmed the fears.

Air Peace airline is the market leader with over 40 per cent of the total domestic operation as at 2021. It boasts of 32 aeroplanes, out of which only 12 were active as at last Friday.

Arik Air is next in terms of market coverage. It earlier boasts of 11 aircraft out of 30 on its fleet before its takeover in 2017. Currently, it has five active aircraft in operation.

Azman Air has a total of eight aircraft on its record, out of which only three are currently active. According to Airfleets Aviation platform, Max Air has a total of four active aeroplanes out of over eight credited to its operations.

The only state-owned airline, Ibom Air, has a total of eight aeroplanes out of which six are in active service. United Nigeria, has in over a year of operation, acquired four aircraft and two are currently active. Overland Airways also has about four in operations out of a total of 11 aeroplanes. Green Africa has its two aircraft in active operation. The duo of Aero Contractors and Dana Air have a total of 14 aeroplanes between them, all currently inactive.

The implication of having only 38 planes active out of a total of 98 or 38.77 per cent fleet operating capacity is most telling in the surging passenger traffic. The National Bureau of Statistics (NBS), in April 2022, estimated that 13 million passengers travelled Nigerian airports in 2021.

About 10 million of the figure is domestic travellers, which translates to 27,397 travellers daily. And when benchmarked against 38 active aeroplanes, each aeroplane has 720 passengers daily – that is, an average of seven to nine hours of operation (depending on aircraft cabin size).

Chief Executive Officer of Ibom Air, George Uriesi, at an aviation conference in Lagos, noted that in other parts of the world, nine flight hours daily would be fine, but not in Nigeria where the average daily operating hours per aircraft is five – given myriads of limiters that render aeroplanes grossly under-utilised.

Technically, more than 30 to 40 per cent of the travellers are currently underserved, with attendant crimp on demand and soaring cost of travel, just as air travel has become an act of faith.

As of yesterday, The Guardian learnt that most seats on the busy Lagos, Abuja, Port Harcourt, Kano and Kaduna routes, where available, were sold for between N76,000 to N100,000 for one-way economy seats. Round-trip tickets ranged between N140,000 to N190,000, depending on route, airline and time of purchase.

Chief Operating Officer of one of the airlines said the heavy downtime mirrors the dire reality in the sector.

“The truth is that more than half of those inactive (60) aeroplanes should be in operation right now. I’m aware that quite a number of them are in different stages of maintenance but delayed by shortage of hard currency. So, as we are struggling to fuel the few schedules available, we are also looking for dollars to bring more equipment into operations. You know how much a dollar costs now (N725/$) and you need an average of $2 million to do a C-check on B737.

“The two issues together are an overkill for any operator. We are really struggling and trying to make the most of the situation. The delays and cancellations are unfair to customers, but the airline also has to survive first. I have to put a cost to every move; otherwise, there is no point. It is a very difficult situation for us all. And without something drastic happening, I don’t see anyone surviving this for too long,” he said.

Uriesi, who is also a former Managing Director of Federal Airports Authority of Nigeria (FAAN), said operators were the most affected by the rash of idle capacity caused by the ‘Nigerian conundrum.’

He explained that for every one hour of flight an average aircraft missed, it is at least N4 million of potential revenue lost.

“The Nigerian airline uses the same airplane as everyone in the world. But compared to Europe, America and even Asia, our aeroplanes are way more expensive to purchase than theirs. Secondly, we pay higher insurance costs. Our safety record is very good now, but it has no impression on the insurers. As far as they are concerned, they have blacklisted Nigeria and you will have to pay a premium that is three-times more than the operators in Europe.

“Already, there is no balance, yet you are paying in dollars but selling in Naira. On top of it all, you are operating in a systemically limiting environment that makes it harder for you to be as productive as your colleagues in Europe, Asia and North America.

“The number of flights we do not utilise in a day because of those limiters is plus/minus three flights. That is N12 million worth of revenue daily opportunity lost. And I’m using N60,000 per seat on a 67-passenger flight, which is very low for most aircraft. That will be N4 million revenue per flight, 90 flights a month and N360 million of revenue off the table in a month for one aircraft. And in a year, it is 1,000 flights and N4.3 billion per aircraft,” Uriesi said.

He added that it was time Nigeria set up a home-based aircraft leasing company that would service the local operators in local currency and off-take the burden of seeking hard currency for aircraft purchase.

Indeed, his proposal is one of the cardinal objectives of the Aviation Roadmap initiative that the Minister of Aviation, Hadi Sirika, unveiled to stakeholders in Lagos and Abuja in 2016. The roadmap, aimed at “transforming” the sector, has deliverables like: a new national carrier, concession of airports for efficiency, Maintenance Repair and Overhaul (MRO) facilities to curb capital flight, and aircraft leasing companies to serve local operators. None of those have seen the light of the day.

Chief Executive Officer (CEO) of Belujane Konsult, Chris Aligbe, reckoned that the components of the Aviation Roadmap are crucial elements that should change any industry at any time, and “it is for that reason many of us supported it.

“Sometimes, one gets worried that those components did not come as early as they should. The industry would have been by far better. I feel somewhat disappointed in the context that circumstances appear to have made it what it is today. We were at the threshold of it, but circumstances of COVID-19 became a major issue and the depression that followed the pandemic too, not only for our country but for many countries,” he said.

He added that the problems of the local sector are beyond the industry and the Ministry of Aviation. And until the various arms of government come together with an affirmative action to address the issue of forex and fuel, “we would continue to be in this quagmire.

“If we allow aviation to collapse, the whole nation has collapsed. But we should not wait for that to happen,” Aligbe warned.

CEO of Topbrass Aviation, Capt. Roland Iyayi, said that the sob story could have been different where the aviation policy is right to catalyse economic growth.

Iyayi noted that Kenya and Ethiopia had similar challenges, but are least complaining because they have designed their policy framework for the development of their natural economy.

“The policy we operate in our sector is not suitable for the development needs of the country. You don’t set up aviation because you can, but to catalyse the growth of the country. All our airlines are operating into a finite market; and that is the same thing we have been saying in the last 10 years. There is a need to address the policy to support growth of other aspects of the economy – tourism, extractive industry and so on.

“I see more airlines failing in the short-term, simply because there is no capacity and airlines not getting adequate financial muscle to meet obligations. So, airlines will fail. It is probably going to get worse before it gets better. It is a shame, just because the foundation is not right,” Iyayi said.

MEANWHILE, Bankole Bernard, suggested, yesterday, that 18 unviable airports in the country should be turned into shopping malls to generate revenue. Bernard, Group Managing Director of a holding company in the aviation sector, was speaking on the sidelines of the 26th annual conference of the League of Airport and Aviation Correspondents.

According to him, only four airports – Lagos, Port Harcourt, Abuja and Kano – out of 22 airports in the country are viable. The operations of the other 18 airports had been unviable over the years, while efforts to enhance operations of Owerri Airport, another international aerodrome to operate from sunrise to sunset had proved abortive over the years.

He urged the Federal and state governments to consider the construction of shopping malls and other facilities that would attract more commercial activities to the unviable airports.

“What are the possible solutions to consider given the numerous challenges we are faced with in the industry? We can start with the modernisation of airport terminals with shopping malls.

“This will contribute to the commercial viability of the airports and other necessary infrastructures like the internet and constant power supply to support businesses.

“We must begin to think of an alternative power supply like renewable energy to keep the airports functional and reduce the cost of operation in the long run. This will also make the airports viable and attractive,” he said.

He added that government could also consider the provision of affordable hotels, which would give credence to investments in the industry.

BY  Chanyaporn Chanjaroen, Bloomberg News

Morning commuters in the business district in Singapore, on Thursday, Feb. 17, 2022. Singapore is expected to announce tax increases in its budget Friday as officials seek to balance the books after two years of pandemic-induced deficits -- even as challenges mount from rising inflation and a slowing economic recovery. Photographer: Lauryn Ishak/Bloomberg , Bloomberg

(Bloomberg) -- Seven in 10 Singapore employees want a four-day work week to help them achieve better balance in their lives, the Straits Times reported Monday, citing a July poll conducted by Milieu Insight.

Some companies in Singapore are already experimenting with a shorter working week, according to the report. New York-listed PropertyGuru Group Ltd. is giving staff more rest days, as are smaller businesses including barbershop chain Sultans of Shave and dental practice DP Dental.

Read More: Four-Day Work Week Has a Chance to Gain Traction This Time

Flexible employment arrangements have been in the spotlight in recent years, after the Covid-19 pandemic forced millions of people to work from home. In a six-month experiment that is the largest of its kind in the world, 70 companies in the UK are currently allowing staff to work a four-day week without a reduction in wages. 

Read More: Return-to-Office Strategies to Avoid Being There All the Time

The Singapore National Employers Federation will be watching the outcomes of the UK trial but will not endorse it, the Straits Times  quoted SNEF executive director Sim Gim Guan as saying, adding “There is no one-size-fits-all type of work arrangement that can apply to all workplaces.”