How FG’s aviation roadmap can help create viable international airports
Airports across the world are catalysts for growing tourism and key to a country’s national and international trade relations. For countries like Nigeria, the International Air Transport Association (IATA) forecasts that more jobs can be created, and additional economic growth achieved if the transformative power of aviation is used as a strategic pillar to further strengthen and enhance its economic recovery and national development.
IATA said prior to the COVID crisis, aviation contributed $1.7 billion to Nigeria’s GDP and supported 241,000 jobs. Over the next 10 years passenger volumes are forecast to grow more than 7 percent annually, exceeding the global average by a healthy margin.
For Nigeria, this means an additional 7.9 million passengers will take to the sky every year, creating a significant opportunity to accelerate economic growth, boost prosperity and support development.
However, despite these significant prospects in Nigeria’s aviation sector, the country’s air transport infrastructure still ranks low among African states.
Experts say despite the country’s demographic and population advantages, the aviation sector cannot reach its full potential with the current state of the nation’s airport infrastructures.
Deplorable state of the airports
The deplorable state of airports, international airports, in Nigeria for long has been an issue of concern for all stakeholders – passengers, frequent travellers, air operators, aviation workers and government officials -, as over the years, instead of an upgrade to the terminal and aeronautical infrastructure, the existing infrastructures are dilapidated and left to rot.
The Kaduna International Airport still lacks a proper control tower, same for Katsina Airport and Mallam Aminu Kano International Airport, Kano.
The derelict state is obvious in that, since June that the check-in system at the Murtala Muhammed International Airport shut down over alleged indebtedness and expiration of contract between the Federal Airports Authority of Nigeria (FAAN) and the airport automation company, Societe International Telecommunication Aeronautiques (SITA), it is still unresolved.
The system shutdown led to chaotic scenes in all the four international airports – Lagos, Abuja, Port Harcourt and Kano. Sadly, since then, even with FAAN moving to another service provider, after asserting that SITA’s 10-year contract with it expired in May 2021, the issue has not been resolved.
Passenger facilitation process at the Murtala Muhammed International Airport (MMIA), Lagos, has continued to worsen till now, as it was discovered that the new service provider, Arlington -RESA Airport Management Solution, which was supposed to replace SITA, was yet to install its own equipment to migrate airlines to the new system due to the fact that SITA is still being owed.
FAAN denied owing, as it accused SITA of reneging on the contract to stay six months and ease the new service provider when it learned that it will not renew the agreement. FAAN has provided a back-up/ ICTS for the airlines but found out that most airlines fail to use the facilities.
This situation has led to the sub-optimal usage of the international airports in the country and loss of revenue that should accrue to the coffers of the government if the airport facilities are optimally used. With the government of the view that it doesn’t have the resources to upgrade the airports, the decay doesn’t look like coming to an end.
This and other anomalies in the sector made the Executive Commissioner, Corporate Services at the Federal Competition and Consumer Protection Commission (FCCPC), Adamu Abdullahi, at a recent aviation stakeholders’ function, the Airport Business Summit and Expo Africa in Lagos, to asserts that both the poor infrastructure and services at the airports are regrettable.
Abdullahi said the airports cannot compete favourably with world established airports, and the dream of turning Murtala Muhammed Airport (MMA), Lagos, into a regional hub is far from being realised.
Painting a picture of decadence, he stated that most of the nation’s terminal buildings require modern functional ones with state-of-the-art technology. The apron spaces are congested and grossly inadequate, thus not being able to minimise timing in the area of facilitation.
He added that associated services at the airport, such as Airport Rescue and firefighting services, water and power supply are all outdated. “Runways are undulating and deteriorating and have outlived their design life. On the whole, critical safety support services are all stretched to their limits.’’
Hadi Sirika, the minister of aviation minister stated that the four major airports in Nigeria located in Lagos, Abuja, Port Harcourt and Kano were not designed as international facilities. He stated that the airports have not been designed as international hubs but operate separate international and domestic terminals.
“The airports in Nigeria are currently operating in a suboptimal environment as there is relatively low asset utilisation due to the limited opening hours of other smaller Nigerian airports; lack of terminal capacity as the airports fall short of gates, stands and check-in desks’’, he stated.
An overstretched facility is the Murtala Muhammed International Airport, Lagos terminal, built in 1979 for 200,000 passengers, but currently processes nearly eight million flyers.
Aviation Master Plan to the rescue
Minister of Aviation, Hadi Sirika, has pledged commitment to the laid-down development master plan for the sector and its implementation before the end of the current administration.
The minister has pointed out the urgent need for infrastructure investments and modernisation as all airports require investments in runway maintenance, navigation aids as well as terminal facilities.
A solution developed for the obsolete and dilapidated aviation infrastructure by Sirika is the Aviation Master Plan that seeks to revamp the country’s aviation sector with the airports upgrade a major point for consideration.
The master plan included a comprehensive upgrade of aviation infrastructure in the country and a major component of this vision is the proposed concession of the airports to start with the four international airports.
The Aviation Master plan seeks to achieve an aviation economy that will be viable and generate revenue to the government coffers through the optimal usage of all of the facilities.
The immediate solution is to concession the airports and activities are on to make this happen through the Infrastructure Concession Regulatory Commission (ICRC). As confirmed by the minister, the inefficient use, and the airports operating below expectations was why the facilities had been put up for concession.
They are expected to be concessioned for a minimum 20 years based on the information in a document on frequently asked questions about airport concession released by the Federal Ministry of Aviation.
The facilities to be concession are the Murtala Muhammed International Airport, Lagos: international and cargo terminals; and the Nnamdi Azikiwe International Airport, Abuja: international, domestic and cargo terminals.
Others include the Port Harcourt International Airport, Port Harcourt: international, domestic and cargo terminals; and Mallam Aminu Kano International Airport, Kano: international, domestic and cargo terminals.
Concession of the airport facilities means the government has relinquished management to private investors who automatically become responsible for developing the airport and making sure it measures up to global standards.
The airports are expected to be improved upon to meet modern demands which most Nigerian airports lack and the operational efficiency and profitability of the airports will thus increase.
However, it is important that the concession agreement is well spelt out. Both parties – the government and private investors – need to come to a mutually beneficial agreement. This is where the ICRC will be more effective, to get the perfect concessionaire for the country.
Sirika and other stakeholders upheld that private operators for the four main airports in the country would be able to operate the airports with an international standard and expand the facilities in accordance with traffic demand at each airport as the authority had set minimum service levels for the concessionaires to comply with on the airport PPP Projects.
He believed that this move would provide the authority with a tool to set service standards for the operation of the terminals and secure a reliable high-level product.
Tayo Ojuri, CEO of Aglow Aviation, said concession is the only way to solve the infrastructural challenges facing Nigerian airports as the government does not have business in managing airports; so what is key is the way forward and the transparency of the concession process.
Ojuri, noted that the current efforts to concession the four major airports in the country need to have global competitiveness.
“The legal outstanding issues need to be tackled. What is being done? There was a mistake in the past, what has been put in place to ensure that such mistake does not happen again. Collaboration is really key; what model is the government looking at? We expect the process to be objective, we expect that there should be due diligence because this should be a long term plan to revamp the industry in terms of infrastructure,” Ojuri said.
The International Air Transport Association supports airport concession as long as it is balanced and does not pile huge charges on airlines, which are eventually passed to passengers, thus increasing airfares. Therefore, the global body believes in balanced concession.
IATA’s book on Airport Ownership and Regulation sets out key safeguards of public value in a concession project. These include a competitive and transparent transaction process, assessment of bids on balanced criteria, and ensuring the key terms of any concession contract underpin improvements in efficiency, quality of service, and appropriate investment in the airport for the benefit of airlines and consumers.