THE ROLE OF AIRLINE IN PROMOTING SUSTAINABLE TOURISM

ABSTRACT

Travel and tourism plays an important role for the growth of the country’s economy. Airline in Nigeria was not given due consideration because of the restriction imposed by the government. The overall aim of the study is to analyze the characteristics & contribution of airline to Nigerian tourism sector. The study was employed quantitative data research approach. Secondary data supplemented by primary data using questionnaire was conducted. Two hundred twenty six (226) questionnaire i.e. open ended and close ended was distributed to traveler company out of which one hundred one (101) was returned. In Nigerian the private operators in the aviation industry are restricted to the international flight rather than limited to domestic because of the restriction imposed by the regulatory body. Travel and tourism is complementing each other. Determinant factors such as liberalization, seat capacity, and frequency of flight & alternative mode of transport affect the airlines. From the findings their exist relationship between private air and tourism. In addition, airfare, frequency of flight has significant relationship to the variables. Therefore, the government should give an emphasize to this private air and should set free the restriction and bring them to the market to work in collaboration with Nigerian Airlines.

CHAPTER ONE

INTRODUCTION

1.1.Background of the study

The growth of travel and tourism and its contribution to the global economy becomes the point of attention to business and development policy makers. According to a recent report by the World Travel & Tourism Council (2017), for the six successive years (2011-2016), the growth in travel and tourism outpaced that of the global economy (2.5%). Before starting to investigate the nature and contribution of airline operation in Nigeria, it is better to have an insight regarding the trend of travel and tourism sector in Nigeria. The travel business is categorized as part of the tourism industry, which is defined as activities that comprises of persons travelling to and staying in places outside their usual places of residence for not more than one consecutive year for leisure, business and other purposes (United Nations World Tourism Organization, 2008). More than 185 supply side economic activities that have significant connections to tourism are listed under the UNWTO (United Nation World Tourism organization) standard classification of tourism activities. These include among other services; hotels and lodging, food and beverage, culture and entertainment, banking and finance, Transportation (ground, air and water) as well as promotion and public relations etc (ibid).

Tourism industry is one of the major sectors in which many countries rely on to achieve their economic goals as it impacts almost every other industry in a country. Although tourism is a sector in which many African counties have always been active in, the region has the smallest tourism sector compared to other regions in the world and the main reason behind this is the safety hazard of its transportation service which is uninviting for tourists. Looking at the contribution of transport service for a country’s tourism sector, the availability of air transport has increased the opportunity for both leisure and business travelers to experience different cultures and markets. As a result it has increased the contribution of tourism in poverty reduction by generating economic growth, providing employment opportunities, contributing to the trade balance and by being significant source foreign exchange (Kalkidan, 2015).

Good ease of use is essential for the development of any tourism destination. While mass tourism was possible by other means of transport, the great step forward was put by developments in commercial aviation. From the 1970s onwards, there has been a continuous stream of innovations and favorable conditions in air transport which have resulted in the stimulation of growth in tourism, especially in long-haul tourism. Two developments contributed significantly to growth of air transport. (1) The rapid development and application of technology have made it possible for aircraft to operate efficiently and safely. But the main contribution of technology has been to lower air fares, thereby allowing more and more people to use air transport on a routine basis (Inter VISTA, 2006).(2) The gradual abolition of restrictions on air transport has contributed to create an efficient air transport structure based on free market mechanism. These links between air transport and tourism industries are reciprocal. On one hand, tourism is a driving factor for change in air transport, and on the other, air transport opens new destinations and new forms of tourism such as long-haul excursions (Bieger, 2006).

The strong complementarily between air transport and tourism to certain regions means that the performance of the tourism is dependent on both market conditions and government policy prevailing in aviation industry and vice-versa. This implies that both industries should be considered simultaneously and should work more closely for mutual benefit (Forsyth, and Dwyer, 2010). Argue that international aviation agreements were negotiated between countries with no reference to any impacts they might have on other industries, especially tourism. Consequently, until recently, the economic impact of alternative civil aviation regimes has often been investigated with no explicit reference to the benefits of tourism. This can partly be explained by the discrepancies between tourism and aviation industries regarding approaches to measuring demand. The former is usually measured by looking at tourism numbers or tourist- nights and the latter in terms of passengers or passenger kilometers but it is not often possible to identify the purpose, or true origin and destination of travel (Dwyer et al, 2010).

Nigeria has been less successful in developing its domestic air services. Moreover, the country shows no sign of effective domestic liberalization of the air transport market. Nigerian Airlines holds near-monopoly on domestic routes (82.3 percent home capacity). The minor role of the domestic traffic is a constraint for the development of domestic tourism since road and rail accessibility especially in rural area are still very low (Eric, 2013). In Nigerian aviation industry there are 24 licensed companies registered to operate in airline, out of the 24 licensed companies 9 have already started operation. The companies that had started operation were licensed either to provide passenger or cargo transportation services with the exception of a few that were licensed in both categories.

According to Nigerian Civil Aviation Authority (ECAA, 2016), the Nigerian government was invited by the United States of America to attend the Chicago conference of December 7, 1944. This made Nigeria one of the few African nations to sign the convention of the International Civil Aviation Organization. This same year, another major step was taken by the Government of Nigeria and the Civil Aviation Authority was founded. One year later in 1945, Nigerian Airlines was founded with six-second world surplus DC-3/c-47 airplanes. In 1951, through the technical assistance provided by the International Civil Aviation Organization, aviation school was opened in Abuja. The first 60 trainees of the school were trained in Communication, Navigation, Aircraft, Metrology, and Radio operation and maintenance.

There are 61 airports in Nigeria, of which two international and twelve regional/ domestic are being administered by the ECAA, a regulatory agency, and the Nigeria Airports’ Enterprise, a service rendering agency. Almost all Airports are owned by the government which also is the main provider of air traffic and navigation services. The ECAA has developed a comprehensive National Airports Development Plan covering the period 1999-2017 including among others airport expansion, pilot training and aircraft maintenance. Bole International Airport is Nigeria’s major entry point by air and is currently serving more than 150 flights a day with Nigerian Airlines accounting for more than 60 daily departures. It is the third busiest airport in Africa, handling over 3 million passengers per year. The airport has been upgraded in recent years to quite high standards, and is now able to handle up to 17 aircraft simultaneously.

1.2. Statement of the problem

Nigeria as one of the African countries that possesses the highest number of World Heritage Site, as recognized by United Nations Education, Social and Cultural Organization (UNESCO) led the government to prioritize tourism development. By recognizing the benefit of the industry owing to its contribution to the country’s GDP and its influence on other sectors. The government has given due consideration to tourism in its development strategy as a driving force for economic growth. The speedy mode of travel for most tourists is air transport. Thus it is one of the factor of tourism flow to the country and needs due attention in making the tourism sector of the country become one of the chief income generating industries. Tourism is increasingly being promoted as an important source of economic growth especially in developing countries. While there are many elements that contribute to tourism growth, without an efficient air transport system, it is almost impossible for a number of landlocked developing nations like Nigeria, to expand and sustain domestic and international tourism.

The presence of an efficient air transport service increases economic competitiveness among countries by facilitating access to the world market and enhancing regional integration. It also eases labor mobility advancement of hospitality and tourism industry.

Therefore, Tourism development trunk from efficient transport network will, in the presence of strong linkage with the local economy, not only create direct benefits for tourism-related businesses such as hotels, visitor attractions, restaurants etc., but also indirect benefits in other sectors such as agriculture, construction and manufacturing and therefore contribute to poverty reduction (Eric et al, 2013).

In 2014/15 the travel & tourism sector accounted for 4.1% of the GDP. These statistics reflect the economic activities generated by industries such as hotels, travel agents, air transport service and other passenger transportation services (UNWTO, 2015). In Nigerian context the tourist in- flow has been steadily rising over the past five years reaching 793,000 in 2014/15 and the largest share comprises of vacationers accounting for 34% of the total number of tourists. Business and conference tourists together account for about 28%, while overnight transit passenger accounted for 16% of the total number of visitors. For the past five years the number of tourists has been growing at an annual rate of 13% In its effort to make Nigeria one of the top five tourist destinations in Africa, the (Ministry of Culture and Tourism here after, MOCT is planning to increase the number of visitors to 2.5 million by 2020 (MOCT, 2015). Tourism accessibility has evolved and become very much commercialized and developed in countries like Nigeria. The accessibility of a destination is an indicator for tourist arrivals, which increases tourist receipts to the country.

Air transport are vital, Due to impact of restrictive regimes, there has been a general move towards liberalization in recent years since 1996. The airline sector was moderately opened to private investors by the FDRE investment proclamation No. 37/1996. The restrictive regulatory of this proclamation permit only Nigerian nationals to invest in this sector using aircraft of maximum loading capacity of up to 20-passenger or cargo capacity up to 2700kg. The revised investment proclamation also increases the maximum loading capacity from 20 to50 and removed the restriction on cargo capacity. Even if the revised proclamation increase the number of passengers and cargo capacity, none of the airlines are not allowed to operate on the scheduled operation thus, they are operating on the non-scheduled (charter operation). However, if there is a liberalization on private air line in Nigeria the development of this air line shows unsuccessful.

In Nigeria there is airline service starting from 1961 but the sector is still not growing because of different factors these are ; lack of travel insurance for tourist, absence of tour operators and private air company working in collaboration, absence of participation of Insurance and banking industry on this sector and Impossibility of operating cargo service and direct flight is not allowed, these and other factors are the one which hinder the development of airline service and that leads to the under development of tourism sector. The other reasons which stated for the slow moving of tourism industry such as ; lack of approaching tourist, rigid bureaucracy and lack of workable system are the factors which negatively affect the development of Nigerian travel and tourism sector.

It is important to note that the Nigerian government has set in train an initiative to develop the tourism industry. In order to achieve this well, it is necessary to collaborate with Nigerian Airlines, airline providers, tour operators as well as it is better to encourage foreign ownership. In most African nations tourism is constrained by the limited offer of flights and the lack of convenient services. A number of problems that are likely to have a negative impact on tourism have been identified in this view. These include problems relative to high airfares and to insufficient service of scheduled or even charter services and problems relative to the inadequacy of airport infrastructures and, last but not least, problems relative to aviation safety (Eric, 2013).

According to emerging findings, over the longer term, the growth of the Travel and Tourism sector will continue to be strong so long as the investment and development takes place in an open and sustainable manner. Enacting pro-growth travel policies that share benefits more equitably can foster a talent and business environment necessary to enable Travel & Tourism to realize its potential. In doing so, not only can we expect the sector to support over 380 million jobs by 2027 (World Travel & Tourism Council, 2017). A number of factors contributed for the growth prominently the advancements in transport and communication services (ibid). However, the role of the private transport sectors to the growth of the tourism sector is less investigated. Therefore, this study is essential to explore the nature and contribution of airline to the Nigerian tourism sector. By doing so, it is intended to provide an insight for the tourism industry policy maker to consider the airline industry major contribution for the advancement of tourism industry of the country.

1.3. Research Questions

The study is going to be guided by the following research question.

1. How much is the contribution of airline to Nigerian tourism?

2. What are the major drawbacks that limit the advancement of airline service in Nigeria?

3. Which are major factors that affect the contribution of airline service for tourism industry?

1.4. Objective of the study

1.4.1. General objective

The overall aim of the study is to analyze the nature and contribution of airline service in Nigerian tourism industry.

1.4.2. Specific objectives

Specifically, the study tries to address the following key research objectives

1. To examine the features of airline service in Nigeria

2. To investigate the problems associated with Nigerian travel and tourism industry.

3. To assess airline for the advancement of tourism industry

4. To assess the factors that affects the contribution of airline in the development of the tourism industry

1.5. Significance of the study

In general, identifying the nature and contribution of airline service will help to provide relevant information to the policy makers to enable them to come up with the appropriate policy regarding the growth of the sector, its contribution to the tourism industry and to the general economy as a whole. And also the output from this study will assist both travel and tourism industry stockholders to deliver practical solution to mitigate the problems regarding harmonization of air transport and tourism development strategy.

Hence, this research work will have a significant contribution of revealing the impact of airline contribution on the development of Nigerian tourism industry through identifying the major factors that affects airline service and to mitigate those hindering factors by forwarding the possible solutions and recommendations. Additionally the findings from this study will provide relevant information to the operators and also it will deliver additional input for other scholarly work in the field of aviation and tourism industry.

1.6. Scope and limitation of the study

The scope of the study relies in the areas of identifying the major factors that affect airline development in line with its contribution in the tourism industry considering airline service as dependent and tourism sector as independent variable by utilizing descriptive analysis model determining the airline contribution to country specifically to the tourism industry of the country which have not been incorporated in other previous or recent studies in Nigeria.

1.7. Limitation of the study

The major limitation of this study is that it is difficult to incorporate the data before 2012 because, domestic air transport sector was re-opened for private sector participation and relevant data is available after liberalization of the sector. The other limitation of the study includes difficulty to find relevant data on the related topic and unavailability of enough literature on Nigerian travel and tourism industry. From the sample size perspective also there will be limitation to select the sample from the limited number of airline companies in Nigeria. The study will be conducted through explanatory by adopting multiple regression model.

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