The federal government said it is targeting about $3billion from the concession of the Murtala Muhammed International Airport (MMIA), Lagos considering the passenger traffic, the aircraft movement and the volume of cargo processed through the airport.
Minister of State, Aviation, Senator Hadi Sirika said that government was maintaining the Lagos airport and other airports slated for concession, including the airports in Abuja, Port Harcourt and Kano, and plans to raise their values to earn more money from their concession.
Sirika said that the certification of the Lagos airport by the Nigerian Civil Aviation Authority (NCAA) in accordance to the International Civil Aviation Organisation’s (ICAO) airport safety and security regulation has added value to the planned concession of the airport and would generate money for government.
An official of the Federal Airports Authority of Nigeria (FAAN) told THISDAY that the revenues generated from the Lagos airport to the coffers of the agency would make it a viable airport for concession.
Sirika said government would continue to work on the airports to not only improve their value and to meet security and safety standard.
The Minister said: “When we come to concession the value of our airports will increase. We will get more money. We are going to concession, which we will. We are going to concession all Nigerian airports, beginning with the four major airports: Lagos, Abuja, Kano and Port Harcourt and later the rest. The President has given his approval and we took it to the Federal Executive Council and it was also approved.
“Very soon the process will start and it will start with Lagos followed by Abuja, Kano and Port Harcourt. Where we are today we have formed a team and steering committee on concession. We have gone to the Council and got approval for transaction advisers. They have started work. We have signed contract with them. They have commenced the process and they will bring us the outline and full business case after which we will put notice for proposals, then we continue the process of concession.”
Sirika said the vision of the federal government was to build strong institutions in the aviation industry, which is hoped to move the sector forward.
“You could see that from our vision the intent is to create very strong, viable and self sustaining institutions that are good enough to take our airports out of the woods and to begin to do things in line with the International Civil Aviation Organisation (ICAO), which is a UN agency. What we have done, we are doing and will continue in the future is to follow the standard in accordance with ICAO. And we will continue to achieve these one after another,” he said.
General Secretary of Aviation Round Table Initiative (ARTI) and a former Commandant of the Murtala Muhammed International Airport, Lagos, Group Captain John Ojikutu (retd) said that the Lagos airport generates huge revenues for FAAN.
“Using the air traffic and passengers traffic statistics of 2014/2015, the expected yearly revenue from FAAN in particular, whose facilities are planned for concession is about N65 billion from both aeronautical (N61.5 billion) and non aeronautical (N4.5 billion). However, the industry Union members believed that the revenue from bill boards, toll and gates, fuel surcharges and cargo sale charges which are mainly non aeronautical are the large chunks of revenue earnings that were given for concession illegally but which have not subsequently impacted on the industry,” Ojikutu said.
Ojikutu however warned that government should be circumspect in the plan to concession to airports, saying that the objective of concession or privatisation is to increase productivity and efficiency, and to improve the financial health of the public enterprises with sufficient savings for government from the suspended government subsidies.
THISDAY