Stakeholders in Nigeria’s aviation sector have said that if the Federal Government must concession Nigerian airports, it must adopt the right models that address infrastructure deficit.
Speaking during the annual colloquium organised by NigeriaTravelsmart.com in Lagos on Thursday, Nnaji Nnolim, chairman House of Representatives Committee on Aviation, said privatisation reduces the need for public sector investment, provides access to larger commercial sectors, and allows airports to diversify services without the fear of government control and interference.
He said in theory, this may lead to increased operational efficiency, as well as create new paid incentives for management and employees.
Available statistics indicate that more than 50 percent of European airports have some form of private ownership, with this percentage increasing significantly since 2011.
Nnolim noted that most large Australian airports are now owned by consortiums of private companies.
He said Gold Coast Airport, for instance, was arguably an example of a successful privatization model, having seen almost USD233m of investment since it was taken over by Queensland Airport Limited in 1998.
“Many countries are seeking to replicate this model/success. In May, Japan invited the private sector to submit proposals for the operation and management of seven airports under a 30 to 35-year concession. The country’s transport ministry is attempting to leverage on the private sector to promote tourism in the Hokkaido region.
“Elsewhere, Brazil is planning to shut down its National Airports Authority and sell its 54 airports to private companies. It kicked off the ambitious programme last year, raising USD889.08m through an auction of concessions for four airports,” he said.
Nnolim added that sadly in Nigeria, the story has been one experiment, too many challenges.
“Examining the first experiment we had in this sector, which was the build, operate and transfer (BOT) arrangement the Federal Airports Authority of Nigeria (FAAN) entered with Bi-Courtney Aviation Services at Murtala Mohammed Airport local terminal, popularly known as the MM2, it has been riddled with controversies leading to many court cases,” the chairman House of Representatives Committee on Aviation stated.
Mohammed Magashi, a technical board member of Arik and Aero Contractors, said the development of airports was still very new to private sector.
Magashi stressed that it is the responsibility of the government to develop the airports until they get to a level when they can be sold to the private sector.
“I see no economics behind concessioning all the airports in Nigeria, especially the unviable ones because private sector wants to make money from it. Government is responsible for airport infrastructures and it is only when these things are developed that it can change hands,” he added.
Simon Tumba, the organiser, the CEO of NigeriaTravelsmart.com and organiser of the event, said the government needed to explore a Public-Private Partnership (PPP) and concession the airports carrying along the workforce at FAAN.
“With Nigeria’s God-given natural and Human Resources, and a solid leapfrogging plan and strategy, we should be aiming for a futuristic airport of $2.5billion. We have the population, the market and geographic position to make and realize such aspirations.
“The aviation unions who are averse to concessioning of our airports are merely shooting themselves in the foot, and in the long run, may end in regret and bitter cries,” Tumba added.
