Air Peace, Nigeria’s largest airline, has unveiled ambitious plans to launch direct flights between Nigeria and Brazil, a historic air link expected to strengthen economic, trade, and cultural ties between Africa and South America. Following the signing of a Bilateral Air Services Agreement (BASA) between Nigeria and Brazil in 2025, the airline received approval to operate scheduled direct services from Lagos to São Paulo, with Rio de Janeiro also under consideration.
The announcement was widely celebrated as a milestone for Nigeria’s aviation industry and a sign of deepening diplomatic and commercial cooperation between the two countries. Air Peace successfully operated an inaugural demonstration flight, further reinforcing optimism around the route’s potential.
However, despite this progress, uncertainty continues to surround the reliability and long-term sustainability of the proposed Brazil service. A combination of operational disruptions, regulatory disputes, and structural challenges within Nigeria’s aviation ecosystem is raising concerns about the airline’s capacity to maintain the route.
Air Peace CEO and Chairman, Allen Onyema, has repeatedly warned that Nigerian airlines are operating under what he describes as a crushing and unsustainable tax regime. He argues that multiple levies imposed on ticket sales, aircraft imports, spare parts, and financing costs are eroding already thin margins in an industry burdened by high fuel prices, maintenance expenses, foreign exchange volatility, and restricted access to funds.
Speaking on Arise News, Onyema cited a domestic airfare of approximately ₦350,000, claiming that airlines retain as little as ₦81,000 after statutory deductions and operating costs. He noted that this reality contradicts public perceptions of excessive airline profitability and warned that cumulative charges inevitably translate into higher fares and reduced passenger demand.
One of the central points of contention is the 5% ticket sales charge collected by the Nigerian Civil Aviation Authority (NCAA). Although the charge is embedded in ticket prices, Air Peace argues that airlines often absorb its impact to avoid further suppressing demand. Onyema has also criticised the application of Value Added Tax (VAT) to airfares, aircraft imports, and spare parts under recent fiscal reforms.
“There’s VAT now on the importation of aircraft. If you buy an aircraft for $80 million, you must pay 7.5% of that amount,” he said. “If you import spare parts, you pay the same VAT. On top of this, loans attract interest rates of 30 to 35 percent. We are choking.” He warned that these costs threaten the survival of domestic carriers and undermine the viability of international expansion plans, including long-haul routes such as Nigeria–Brazil.
The NCAA has firmly rejected claims that statutory charges are responsible for rising airfares. The regulator insists that all passenger-related charges are lawful, transparent, and clearly disclosed, and emphasizes that it does not regulate airfare pricing. Michael Achimugu, the NCAA’s Director of Public Affairs and Consumer Protection, dismissed media narratives linking high fares directly to taxation.
“Lies have been told over this matter, over and over,” he stated in a post on X. “While the NCAA does not regulate airfares, I invited domestic airlines to clarify these tax claims, and they admitted they do not pay the volumes of taxes being mentioned publicly.” This divergence of views highlights a broader policy debate over whether aviation in Nigeria should be treated primarily as a revenue-generating sector or as a strategic industry requiring fiscal protection to remain viable.
The taxation dispute comes amid a period of significant operational and reputational challenges for Air Peace. The airline recently denied allegations that it abandoned passengers in Barbados en route to Jamaica, describing the claims as misleading and lacking proper operational context. It has also faced regulatory scrutiny over alleged fare exploitation on certain southeastern domestic routes , claims Onyema has publicly refuted.
More critically, Air Peace experienced major disruptions in late November when four Airbus A320 aircraft operating under ACMI (wet lease) agreements were withdrawn from service. The aircraft, leased through Latvian operator SmartLynx, were reportedly reclaimed by owners including AerCap, Castlelake, and Global Principal Finance after SmartLynx defaulted on its own lease obligations. Air Peace described the withdrawals as abrupt and unjustified, estimating financial losses exceeding $15 million. The episode underscores the vulnerability of African airlines that rely heavily on short-term wet leases in markets with limited access to capital and spare aircraft.
Despite mounting challenges, Air Peace says it is determined to begin 2026 with confidence.” The airline has announced a restructuring of its regional operations, shifting all night-time regional flights to daytime schedules to improve punctuality, passenger experience, and connectivity across West Africa, as well as onward long-haul connections from Lagos.
The carrier also plans to expand its regional network by the end of the first quarter of 2026, with proposed new routes to Douala, Libreville, Kinshasa, Conakry, Bamako, and Johannesburg. These ambitions follow the airline’s landmark inaugural flight to London Heathrow in October.
Air Peace’s ambitions and difficulties reflect the broader challenges confronting Nigeria’s aviation industry and much of Africa’s. As governments pursue revenue reforms and regulators intensify oversight, policymakers face a delicate balancing act between fiscal objectives and the commercial realities of airline operations.
With passenger demand rising and scrutiny increasing, the sustainability of domestic carriers remains a critical issue , one that will significantly influence the future of air transport between Nigeria, Brazil, and the wider global aviation network.
