Victor Bout and the World's troubled spots

Scores of those who argued against Victor Bout were questioning "Why does he tend to commonly operate in or around the world's hot spots?", places like Angola and Congo for example.  Why did not he operate in "more civilized" and more stable countries? Why were Victor Bout's airplanes registered in countries like Liberia? Why not in Europe for example? 

The answers to all of these and similar questions are very simple.  The fleet dictates where the aircraft can be registered, and the available opportunities dictate where to operate.  Let us talk about that in detail...

Why Victor's aircraft were registered in "Flag of Convenience" countries?

All of Victor's aircraft were Russian-made aircraft, and in most cases they were ex-military purchased from the government upon the collapse of the Soviet Union. All aircraft must be certified for particular use by the manufacturer, and by the aviation authority in the country where they were manufactured or were operated.  Although plenty of the Russian-made aircraft were certified for civilian operations, a good part of them were not, for example the Antonov-8 aircraft.  The AN-8 were manufactured by Antonov for the Russian military, and therefore, there was no need to have them certified for civilian use, notwithstanding that such certification would not be required given that all establishments in the Soviet Union used to be part of the government along with the civilian airlines.

When Victor Bout purchased the Antonov-8 as his first aircraft, he was faced with a great problem in registering the aircraft given that the AN-8 did not have certificate from any country for civilian use. Here comes the "Flag of Convenience"  to play.  A  "Flag of Convenience registration" means registering the aircraft in a country that allows the registration of an aircraft or a vessel into its flag at a higher cost and minimal scrutiny. In such registration the aircraft or vessel would not usually be required to even visit the country, where it is being registered, for inspection. Liberia was, and still is, offering such registration, along with several other countries around the world.  Therefore, and given that most of the Russian-made aircraft had no certificates, Victor was forced to register his fleet in a "Flag of Convenience" registry. It is a matter of necessity rather than choice, and it is still the same until this day; however, at lesser degree given that most of the Ex-Soviet fleet is now aging and retiring.

This is the answer as to why Victor Bout's aircraft were registered under a "Flag of Convenience" rather than in a "respectful" registry.  It is also important to mention, that "Flag of Convenience" does not automatically mean that the operator is using "unsafe or less safe" aircraft. It is a matter of fact and record to mention that throughout its existence Aircess maintained accident-free record of operation. 

Why did Victor operate in  "troubled" areas?

Troubled area in competitive terms means better opportunity and higher aircraft leasing rates, where the matter is placing assets to their "best utilization."  The decision concerning "where to operate" was always subject to a standard cost-benefit line of reasoning and comparative analysis of:

In most cases, Victor's decision to operate in Africa and the Middle East was dictated by the type of aircraft he operated and the restrictions applied over the operations of such assets. For example, the heavy freighter Ilyushin-76 is a Stage-II aircraft that is not permitted to fly into Europe, the US, and several other countries because it is not compliant with certain requirements related to noise and pollution. Therefore, and given that you own one of this type, you are restricted to operate in less restricted airspace which always happened to be in Africa, Middle East, and such places.  Besides the Noise and Pollution, several other restrictions placed severe limitations on the area of operations for the Russian-made aircraft, and that was the number one reason that forced Victor Bout into operations in Africa.

The other factors involve the risk and available opportunity, that means Victor decided that he can deploy and operate his inexpensive aircraft where the operator with newer and more expensive Aircraft will be unwilling to operate or deploy his aircraft considering the instability and risk.  The "troubled spots" offered plenty of opportunities in the absence of competition. The opportunities were abundant, the risk was too. The risk was involving the loss of aircraft.

For a conventional Western operator the possibility of loosing an aircraft would have barred such operator from doing business in any place where instability exists, as to Victor Bout who had acquired most of his aircraft at a cost equal to what he may collect in one month, the amount of taken risk was tolerable and mitigated through his ability to maintain good relations with the authorities in the area where he operated. 

Nonetheless, risk remains always a risk and the unpredictable can happen where instability persists regardless of relations. As such, Aircess had once lost an Ilyushin-18 aircraft while it was parked overnight. The airport where it was parked was attacked by a rebel group as can be seen in the pictures herein showing the aircraft before and after it was destroyed in the fight.

Considering all the risks it engulfs and all the opportunities it provides, operating an airline in the "Troubled Spot" can be a great prospect if the operator manages to stay away from the trouble.  The Iraq war, for example, provided great opportunity to dozens of start-up airlines to work and grow despite the grave risk the operators are taking with every take-off.