Government’s plan to inject N32 billion into rehabilitation of 22 airports across the country raises fresh concerns on its inability to manage such facilities
Stella Oduah, minister of aviation, no doubt had a clear-cut idea of her mission in the industry upon her appointment. One of this was to remodel and renovate the 22 airports across the country, at least, to a minimum internationally acceptable standard, thereby fulfilling her desire of bequeathing a legacy of international standards and competitive business concerns and entities to the nation’s aviation industry. In the first phase of the project, 11 airports, comprising those in Lagos, Abuja, Port Harcourt, Kano, Calabar, Enugu, Owerri, Benin, Kaduna, Yola and Osubi, are locations where construction work is ongoing.
To the discerning Nigerian, this is a project that is long overdue given the deplorable state of the nation’s airports, especially the international wings. The Murtala Muhammed (International) Airport, MMIA, Lagos, for instance, has by all standards outlived its capacity. It was therefore not surprising when Harold Demuren, director-general, Nigerian Civil Aviation Authority, NCAA, described the facilities at the MMIA as the architecture of the 1970s that can no longer cope with the current level of activities.
Now, for international passengers, the MMIA has become a nightmare. Last Sunday, a passenger on board a KLM flight from Amsterdam complained bitterly upon arrival at the airport. The passenger noted that the MMIA does not have a cooling system or, at best, it has an ineffective air-conditioning system, which she reckons is quite appalling for an international airport. “The escalators leading to immigration were not working, so people with hand luggage had to carry their suitcases down the stairs; the luggage carousels were not labelled, so people were not sure which luggage carousel would be carrying the luggage from their flight; while the floor in front of exit to the airport is currently unfinished, with huge holes making it difficult to push luggage trolleys or carts along,” the passenger observed, concluding that the MMIA does not give a traveller a good first impression of the country. That is not entirely new to frequent travellers who pass through the airport.
The Nnamdi Azikiwe International Airport, NAIA, Abuja, is another airport under renovation. In and around the airport chaos reigns supreme. The same situation is applicable in Kaduna airport, where the terminal building has been completely stripped and a newly built small bungalow now serves as temporary terminal building. In all these airports, passenger handling has become very appalling.
George Uriesi, managing director, Federal Airports Authority of Nigeria, FAAN, given his involvement in the building of Cape Town Airport in South Africa and wealth of experience in international airport management, agrees that the airports across the country were an eyesore and that the shameful situation of the airports has caused its users a lot of pain and discomfort. Uriesi told the magazine that for more than 30 years, nothing significant was done to the airport environment. That was how the airports came to a sorry state. He reasons, therefore, that it has become imperative to now begin upgrading and expanding the facilities. “If we don’t do it now, other countries will leave us further behind,” he argues, describing the remodelling and renovation work currently going on as a stopgap measure to prevent further decline in airport facilities in the country. But some stakeholders argue that what is required in Lagos is a totally new airport. However, rather than build new terminals to replace the decrepit one in Lagos and remodel others, the government has decided to renovate the airports in the country in two phases.
The general aviation terminal, GAT, of the MMA is also benefiting from this, as the terminal building used for domestic flight operations and its protocol lounges are undergoing renovation. A new terminal building is also being constructed and will house new arrival and departure halls, a development coming for the first time after over 30 years of the terminal’s existence. Also at the international wing of the MMA, massive work is ongoing for the expansion of the arrival and departure halls of the terminal to accommodate the increasing passenger and aircraft traffic. The expansion would also change the frontage of the terminal, including the diplomatic car park at the airport.
Concerned stakeholders are also divided over the modality of the renovation, especially the financing of the projects. Olumide Ohunayo, an aviation consultant, says there is nothing wrong with simultaneous renovation of the facilities but he is concerned about the source of funding for the project. “The sheer bravado and courage with which the work started made me think the World Bank was investing or lending us some money; my joy sank when I heard the Bilateral Air Services Agreement, BASA, fund, will be depleted for a project that should commercially sustain itself,” Ohunayo observed, regretting that domestic carriers, that are the lambs slain for the growth of that fund, are in a state of coma.
Chris Aligbe, chief executive officer, CEO, Belujane Konzult, an aviation consultancy firm, is also concerned about how government intends to raise the fund. He reasons that if the airport system must work well in the country, then government must make concessions on the major ones. He advocated a legal framework that could cater for the development of airports, airlines and ground handling companies, which will provide a road map for the development of the aviation industry, which he says do not exist in the aviation industry. “All Nigerian airports should be on concession. That is the only option to achieve global standards for airports, which will bring about private sector funding,” Aligbe argued. In a similar vein, Seun Ogunsanya, an economist, believes that private operators should have taken over Lagos and Abuja airports under a concession arrangement, if the country hopes to become a hub, warning that concession or total privatisation of the airports should not be jettisoned, as this is the modern-day approach as exemplified by developed economies.
In view of this, rather than remodel the MMIA with huge amount, experts canvass that a public-private partnership, PPP, should be put in place to construct new terminals at the Lagos airport which accounts for about 70 per cent of air traffic and revenue flow in the country. It is believed that no remodelling or restructuring effort will satisfy the high demand need of that airport. Some airline operators who spoke to the magazine also argued that FAAN had succeeded in wasting public funds in its remodelling exercise, insisting like Demuren did that the Lagos terminal architecture is outdated. Emmanuel Ukpong, editor in chief, ArrivalNews, an aviation industry-based publication, contends that though the country has had a bad record in airport management, failing to execute such works remains at its own peril. He insists that the remodelling is far from being a waste of funds but rather an investment in the future of the industry and all the desirable things that bureaucrats have failed to do.
Going by government’s antecedent in managing facilities and infrastructure, the question on stakeholders’ lips is how far can government go in turning around the airports beyond cosmetic renovation? Experts agreed that sustaining and maintaining the new airports without getting a PPP arrangement will be a daunting task, as PPP remains the best option to get the airports in perfect conditions. Sadly, the albatross of the initiative has been the lack of transparency and respect for the terms of PPP agreement in the past. This has made potential investors in the industry develop the athletic feet of Usain Bolt, the world’s fastest sprinter, from investing in the industry.
The case of the MMA2 is still fresh in their memory. Bi-Courtney Aviation Services Limited, BASL, promoters of the MMA2, has run into turbulent waters in recouping its investment owing to the lack of respect for the terms of its 36 years’ agreement with government on the use of the facility. As part of its agreement, it is said that “no domestic flight operations will take place in or out of Lagos for the next 36 years outside the MMA2 terminal.” Now, with the remodelling of GAT, more clouds may be gathering over the sustainability of MMA2. Similarly, the termination of Maevis’ concession agreement by FAAN has further cast a dark spot on the PPP option, even as the two parties slug it out in court. The concession of NAIA to Abuja Gateway Consortium in 2006, which was revoked by the late president Umaru Yar’Adua in April 2008 also comes to mind.
Last week, FAAN also terminated the concession of building a 2,000-capacity car park and hotel with Terminal Zero. The company was about four years ago given a 45 years’ approval to build the facility directly opposite the MMIA terminal building. According to Uriesi, Terminal Zero showed that it could not develop or execute the project since over the years it was only able to put up only pillars on the site. The site is now overgrown with weeds. For now, FAAN has taken over the property and says it plans to build a multi-storey car park on the site. When this is done, it is hoped that the poor parking situation at the airport, which has consistently constituted huge traffic chaos, will be addressed.
Uriesi told the magazine that the renovation of GAT has nothing to do with the MMA2 agreement. According to him, there is no 36 years’ agreement with Bi-Courtney; rather, it is a 12-year agreement. “The terms of the agreement were very explicit and, besides, the area under concession were well defined, so it has nothing to do with GAT,” he explained. But on the contrary, Dipo Kehinde, spokesman for Bi-Courtney, insists that the company entered into a 36-year agreement with the government through an offer made by FAAN. He told the magazine that the amount spent on the project was duly verified by a team led by FAAN consultants.
Accordingly, a document made available to the magazine shows that there was indeed an offer from FAAN to Bi-Courtney for a 36-year concession. The document dated October 12, 2006, read in part: “On the basis of the KPMG report, which recommends thirty-six (36) years as the tenure for the concession, FAAN is offering BCC Limited a concession period of thirty-six (36) years on the new MMA Domestic Terminal, Ikeja, being developed by Messrs BCC Limited on Build Operate and Transfer (BOT) business arragement.”
Ukpong, lending credence to Uriesi’s position, explained that technically speaking, GAT cannot be termed a domestic airport. General aviation, he further explained, covers the operation of smaller aircraft for services such as crop spraying, border patrol, flying clubs, flying schools and the like. “All major airports deserve a general aviation terminal. The good news is that the NCAA is preparing new regulations for general aviation in the country. The impression should not be given that GAT stands in conflict with MMA2. It does not. MMA2 was not designed for such services,” Ukpong maintained. Besides, the FAAN boss said PPPs are not properly packaged in the country and that accounts for the numerous problems they run into.
Yet, worrisome is the quality of the work being done. Apart from the Abuja airport that was renovated by Julius Berger, practically all the work is done through direct labour as bricklayers are seen carrying sand and tiles in wheel barrows while construction sites are not cordoned off, thus posing a lot of discomfort and potential hazards to travellers. A civil engineer in a government agency who pleaded for anonymity said that some of the materials for renovation are inferior. He readily pointed at the tiles being used at the MMIA, insisting that even the ones being replaced are of higher grade.
Mohammed Tukur, assistant secretary general, Airline Operators of Nigeria, believes that the situation portends a lurking disaster. “What is happening there is a disaster. We cannot have bricklayers doing this kind of work. I have never seen a renovation in an international airport where a bricklayer is carrying sand and travellers are told to remove their legs,” he said. However, the FAAN boss explained that to use the highest grade of materials for renovation would amount to higher cost, and since it is just a stopgap measure pending when a new airport would be built, its is still acceptable. “For me, it’s the end result that matters. When we finish, you will see the ambience and very easy and efficient passenger handling experience in the airports and we all will be proud of it as a people and as a nation,” Uriesi said with optimism.
According to Uriesi, government, through FAAN, is changing a lot of things in the ways that airports are run, not just the infrastructure, but also changing the ways business is done. This includes doing things differently, more like a business than a kind of government department, with a mindset for transformation. If this is achieved, Ukpong foresees two things would happen: improved passenger experience and a leap in commercial offerings because with the remodelling, airports are expected to attract new businesses, which comfortable airport users would patronise, and FAAN in turn would improve its earnings, recover costs and return profit. He recalled that in 1998, Peter Igbinedion, FAAN’s MD at the time, did an extensive overhaul of the international wing of the MMA and launched an appropriate pricing initiative, demanding more for rents and services. “Airlines and other businesses were quite happy to pay. The premier airport’s annual earnings jumped from a meagre N800 million to N2.5 billion in just one year after the renewal. If the current management of FAAN doesn’t drop the ball, this could be replicated after the ongoing remodelling exercise,” he assured.
For now, the chaotic situation in the airports where these projects are being executed will remain, with the only consolation being the FAAN signposts asking for patience and apologising to the public over inconveniences visited on them.