Airport concession and lessons from the power sector — Opinion — The Guardian Nigeria News – Nigeria and World News
Nigerians were outraged in early April when videos emerged on social media showing officials at Murtala Muhammed International Airport, Ikeja – the country’s main gateway to the world – using torchlight from their phones to chaperone passengers stranded in dark airport corridors.
Once again the airport had lost its power source and was plunged into darkness at the height of departure formalities for thousands of travellers. Significantly, the international airport’s departure lounge was the most affected by the outage.
The April incident would not be the first time the airport had lost power at the height of operations and repeated promises to rise to the challenge had not been kept. In his response to the latest outrage, the Chief Executive of the Federal Aviation Authority of Nigeria (FAAN), Captain Rabiu Yadudu revealed that the biggest challenge facing the authority is that some of the underground power cables are damaged and must be replaced because they were installed more than 40 years ago.
In other words, there is unlikely to be any respite from this periodic embarrassment without major reinvestment in the airport. It is also clear that the government is unable to provide the necessary funds – especially since FAAN has never made a profit in all its years of operating the country’s airports and therefore does not have the resources to the upgrade.
If, indeed, there was any proof that the government is a bad business manager, it is the poor state of the country’s airports. From the cooling system to the toilets to the conveyor belts, there is evidence of degradation in all airports and a clue to the poor management of the facilities.
Yet airports are important as gateways that will open the country to the development of tourism and investment. A disappointing airport is unlikely to give a first-time visitor the confidence to invest their resources in the country.
Interestingly, an inbound passenger who has just witnessed the inefficiencies of the international airport is likely to be further confused by the rather modern and ultra-efficient operations of Terminal 2 at the Murtala Muhammed Airport (MM2) built and privately operated under the direction of Bi-Courtney Aviation Services Limited (BASL). That the two extremes of efficiency actually coexist in the same geographical space is one of the marvels of modern Nigeria. It is also an indicator of what private participation in the management of airports could accomplish.
These, among others, must have informed the government’s well-received decision to entrust the management of the country’s main airports to private operators through concessions, in a first phase, of four airports. The airports are Murtala Muhammad International Airport in Lagos; Nnamdi Azikiwe International Airport, Abuja; Aminu Kano International Airport, Kano; and Port Harcourt International Airport.
BASL won the MM2 airport concession contract in 2003 and raised Nigeria’s national airport infrastructure to international standards with the MM2 project designed and completed in 2007. It is therefore no wonder that the smooth operation of the terminal , compared to others at the sprawling Lagos airport complex, was a major defending element of the government’s airport concession plan.
Towards the end of October last year, the federal government closed the prequalification phase for the concession of the four airports. In a document to announce the aviation PPP plans and announce the tender, the Permanent Secretary of the Ministry of Aviation, Hassan Musa, said the concession was aimed at improving service delivery in the airports.
Although FG is keeping tabs on the identity of the bidders, media reports say around 13 companies have expressed interest in the process. BASL, deservedly, would be one of them and seems ready to deploy its experience and resources to transform the MMIA if given the green light.
Another indigenous company that would participate in the prequalification phase is Maevis Nigeria Limited, which had an aviation-related concession contract with the Federal Government, in the area of collecting aeronautical and non-aeronautical revenue and supplying equipment for airline boarding passes. , luggage tags and other travel services at Lagos and Abuja airports.
Some of the international companies that have reportedly expressed interest in the process include the operator of Singapore’s Changi Airport, Changi Airport Group (Singapore) Pte Ltd (CAG), which is wholly owned by the Singapore government’s Ministry of Finance; the operator of the French Charles de Gaulle airport, Groupe ADP; and operators of one of Ethiopia’s airports.
The Ministry of Aviation has announced that it will conclude the process in the second quarter of 2022. But industry observers are of the opinion that the concession of the MMA2 terminal in 2000 after a fire rendered the terminal unusable, presents good lessons for ongoing development. process.
Sanderton Ventures Limited (SVL) won the bid, but due to its failure to meet the standard terms of the deal, it had to forfeit the contract with second-placed BASL to redevelop the terminal. The federal government signed a build, operate, and transfer (BOT) agreement with BASL in 2003, and the terminal was commissioned approximately four years later.
But the partnership ended in court after the FG reduced BASL’s 36-year terminal management agreement to 10 years and stopped the second contract to manage the General Aviation Terminal (GAT) of the domestic wing of Lagos airport.
The question now is whether the federal government is an honest broker who will be transparent and fair enough to ensure that the most qualified bidders win the contract the first time and that they stick to the terms of the agreement. throughout its duration, which, according to the Minister of Aviation, will last at least 20 years.
There’s another reason to be cautious – and that’s the mess the country’s electricity sector has become after much of its operations were handed over to private operators. In fact, a former energy minister, Raji Fashola, scathingly proclaimed that the companies that bought the energy assets had neither the resources to invest in their upgrades nor the minimum managerial experience to do so. operate the assets.
The result is the paralysis that has gripped the electricity supply in the country. Hopefully the FG would be guided by this and avoid the mistake of handing airports over to political actors with little or no experience in the sector.
It is bad enough that we are dealing with a prostrate electricity sector. To conceive of a similar prospect in the aviation sector would be a real tragedy – and something we can avoid.
Tijjani is a graduate student interested in the privatization of public services.