The Federal Government has approved the establishment of the Nigeria Aircraft Leasing Company, a move designed to significantly improve domestic airlines’ access to aircraft and strengthen the country’s aviation sector.

Festus Keyamo, the Minister of Aviation and Aerospace Development, announced the approval on his official X account, stating it was a key resolution from the Federal Executive Council meeting held on Thursday.

This initiative is set to create a sovereign-backed leasing structure, facilitating easier acquisition or leasing of aircraft for Nigerian carriers. It is expected to reduce operational disruptions and enhance the competitiveness of local airlines against their foreign counterparts.

The new company will operate as a Special Purpose Vehicle (SPV), fully funded and managed by private investors. While it will benefit from strategic government backing, it will not impose direct financial obligations on the Federal Government.

The government's role will primarily involve providing sovereign guarantees to international aircraft lessors and manufacturers, particularly concerning repossession rights. This measure aims to mitigate investment risks and attract global financiers.

Keyamo highlighted that this structure would enable Nigerian airlines to access aircraft through a single, credible platform, rather than facing individual struggles in the global leasing market. This is intended to address persistent fleet shortages that have led to delays, cancellations, and a heavy reliance on costly short-term wet leases.

Furthermore, the initiative seeks to strengthen the capacity of domestic carriers to serve local routes and reduce the dominance of foreign airlines, which currently account for approximately 95% of Nigeria’s international passenger traffic.