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Concessioning Nigeria airports

The debate on the viability of concessioning the infrastructures of Nigeria airports to private investors seem to be gaining attraction especially when the Minister of State for Aviation, Senator Hadi Sirika, brought it to the front burner.

The dissenting voices, who are mainly Unions and workers of the Federal Airports Authority of Nigeria (FAAN) though with strong arguments appear to be in the minority. But there are contending interests in and out of government circles.

Although the government initially appeared resolute to carry out the concessioning programme, current signals suggest that the exercise may have been abandoned because of stiff resistance by the staff of FAAN.

Besides, Sirika is said to have been under pressure by some anti-due process top government officials who believe that if due process is followed as suggested by many stakeholders and the Bureau of Public Enterprises (BPE), he may not achieve this objective in the remaining tenure of this government.

Reportedly, the minister had at the beginning envisioned that Tav of Turkey, a company that manages most airports in Turkey would benefit from the concessioning.

Mid last year, a group from the company visited Nigeria and toured the airport facility at the Nnamdi Azikiwe International Airport, Abuja.

Sources at the BPE and Infrastructural Concession Regulatory Commission (ICRC) said if government wished to concession airport facilities, it must follow due process which allow for open bidding for the airports and the process obviously would last beyond this administration.

Already Senior official of the Air Transport Service Senior Staff Association (ATSSSAN), FAAN branch has said that it would be impossible for government to concession the airports as it earlier planned because of the strategy the Minister adopted to carry out the concession programme.

Sirika, had insisted that the Murtala Mohammed International Airport, Lagos; Nnamdi Azikiwe International Airport, Abuja; Malam Aminu Kano International Airport, Kano and Port Harcourt International Airport, Port Harcourt, Rivers State have been listed for what he described as the pilot phase of the planned concession of all of Nigeria’s 22 airports.

The unions and the FAAN workers are kicking against the concession plan, on the premise that the first four airports are the most viable in the country, with Lagos contributing over 60 percent of the revenues that is used to service the other airports.

They also believe that if the government gives out these four viable airports in concession, there would be no more place for FAAN to get the money to maintain the remaining airports.

With the benefit of hindsight, it is obvious that the concessioning plan may have hit the rocks although aviation stakeholders are rooting for it.

While the debate has lasted, it has added political value situating the matter in proper context, and more like taking the government apparatchiks back to the class room. One of those who made strong points is Pat Utomi, political-economist and public commentator. He believes that beyond government intentions just to concession infrastructures, until Nigerians change their attitude towards private investors, both local and foreign, it may take a long time before the country gets out of its present economic doldrums.

Utomi expressed concerns that government officials hardly obey agreements they sign, saying this would certainly drive away any private investor with a good mind to invest in the economy.
Senator Ben Murray Bruce angle as the chairman of the senate committee on privatization is also instructive.

Obviously in support of the concessioning he said his committee was prepared to facilitate laws to fast-track the success of the programme, as that countries with the best airports are those who had long privatised or concessioned their airport terminals, while those with the worst airports, like Nigeria, have refused to allow private investors manage their airports for them.

An underlining assurance is that the Senate is determined to ensure that Nigeria’s privatisation laws have irrevocable and irreversibility clause, so that no new government can just come in and reverse what the previous government did with the stroke of a pen.

Recently Captain Dele Ore, a former Nigeria Airways pilot, in ‘A Review of Reports, Findings and Conclusions of Committee on Airport Concession 2008’, did a summary of the recommendations of the committee, which he chaired, noting that the committee had recommended the privatisation of the four major airports in the country as far back as 2008. He, however, bemoaned that the report was spiked because of certain contending interests in government circles.

The take here is that the programme is a populist view only if it will be done sincerely and transparently. Contending interests however hold sway.

The government should wake up to this reality. There is need to balance the demand of the unions with its vision on reforms and must not insist on taking credit for start and finish of the program me.

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