Ojikutu: Wholesale concession of airports risky
Aviation security consultant and Secretary General of the Aviation Safety Round Table Initiative (ASRTI), a think-tank group of the air travel sector in the country, Group Captain John Ojikutu (rtd) in this interview with WOLE OYEBADE, said concession remains the best way to revolutionise the aviation industry, if the process is made transparent and restricted to non-aeronautical side.
• N70b Can Be Generated From MMIA Yearly
• Airport Concession, Now The International Norm
• Aeronautical Side Should Never Be Concessioned
What do you make of aviation workers’ earlier rejection of the Federal Government concession plan?
For me, concession of the airports is the way to go. It is not because other government agencies have failed, but because that is now the international norm, particularly as aviation is concerned. The International Civil Aviation Organisation (ICAO) had recommended long time ago that concession of the non-aeronautical side of the airport should be the way to go so that government can concentrate on the aeronautical side.
For almost 20 years now, we have not done much; forget about categorisation. That is why I always tell people that it is only the Nigerian Civil Aviation Authority (NCAA), and its books that are being categorised, not our airports. It is like the National Universities Commission (NUC) going to the university and checking the faculty books; that does not mean that the faculty can produce first or second class-rated students among undergraduates of the university. That is the situation we have found ourselves.
For many years that government has been spending money, we just managed to certify an airport. It is only now that we just graduated an airport out of how many? I still question that certification and can take both the NCAA and Federal Airports Authority of Nigeria (FAAN) up on that. So, the unions must be able to understand things from that perspective. Government must let them know what they want to do with concession.
Like I said, giving out the non-aeronautical side, like what has been done with the Murtala Muhammed Airport II (MMA2) is the way to go. But once the aeronautical side is being concessioned, we are going to start having problems. And all the problems we have started covering up with this Category One rating and others will start exposing themselves. That is my take.
Opinions are divided on whether government should start with the most viable four, or with other 18 airports?
If you are going to concession, don’t concession only Lagos, Abuja, Kano and Port Harcourt airports. Whoever takes Lagos must be able to take Ilorin, Ibadan and other airports with it. That is what some people are saying. My position is this, whoever takes the Lagos airport, must be able to go to another geographical area, be it in the East or North to take two other airports along with it.
The reason is this, if that is done, we are going to open up some of the airports that are tagged unviable to domestic routes because that one will go side-by-side with this multi-landing that we are giving to foreign airlines at our airports. Like I used to say, no foreign airline should go to Lagos and Abuja. You either go to Lagos or Abuja. If you go to Abuja, then you take two or three other airports in other geographical areas, but definitely not Lagos. Ditto for Lagos. If you do that with concessionaires and airlines too, the chances are that the foreign airlines can even partner the people you are concessioning too to develop all these airports.
In 2007, Lufthansa wanted to take over the Murtala Muhammed Airport and asked FAAN to advertise it so that it does not look as if both parties (Lufthansa and FAAN) were doing some kind of bargain. FAAN tried to do that with Lufthansa in Abuja, but the German outfit still refused. We need to be very transparent in what we are doing. For me it is the very best way to go.
How profitable would it be to concession these airports?
From the feelers I’m getting, if someone says he wants to concession MMA alone for $3b, honestly that is a good business. If you calculate $3b, it will give you a minimum of N30b a year over the next 30 years, and all these would be going into the federation account. That is what the minister said and it is beautiful. FAAN, in its present state, has not contributed N10b not even N5b into the Federation account in any year. So, the concession option is better, but let them be transparent with it.
There is nothing to hide in this matter. All we want is to get good money that can be used in other areas, instead of bringing in money and telling me that you cannot concession Port Harcourt unless you build it. Babalakin built MMA2 from the scratch. And you said you cannot concession Sokoto or Maiduguri airports unless you first build them? The answer is no! Concession all of them the way they are. The way they built MMA2, they will build other ones like that.
Aviation unions are still agitating, so how do you think government should address their fears?
I frequently call the minister on the need to dialogue with the unions. Only the other day, I was told that they have been talking. I have taken it upon myself to have discussions with the unions. But I don’t know them. There is nobody who will tell you that there is no sense in concession but the only thing is that the union must be able to understand that it is the only way to go.
Think about it, if you concession the airports to somebody, is he going to bring people from outside to work in it? Is it not Nigerians that he will employ? Chinese that are building the roads, how many of them have you seen around? Are they not Nigerians that are carrying the cements, iron rods and others? MMA2 is there now. Have you seen a white man among those working at MMA2? Babalakin is a lawyer, and he used to have a white man as his managing director, who is gone now.
So, we really need to sit down and understand ourselves. I don’t want us to continue with this bickering because someone is behind all these politics. But government has to be very transparent too. Let us debate it to prevent doing the wrong things. I’m even surprised that the NCAA did certification of that airport (MMIA) and the new car park is there looking straight into the terminal. The other day the Federal Aviation Administration (FAA) in the United States came here and they gave us 60 days (to release their audit report).
I have done audit with FAA, International Air Transport Association (IATA) and pre-ICAO certification before and I can tell you that there must be something very grave about the airport to warrant that delay and it may not be unconnected with the security of that airport for them to go and correct. And if we do not correct it, just watch what will happen between the FAA and NCAA within six months and one year.
I cannot understand some of the things we do and when people clap their hands, I just laugh at them. The problem is not between FAA and FAAN or the airlines, but between FAA and NCAA. If they cannot correct it, they will have themselves to blame. Forget about the fact that we have a Nigerian at ICAO and I know Dr. Babatunde Aliu very well. By the time FAA comes out with something, everyone in ICAO will start coughing because it is only when something happens to America that they shake the whole world. We have to be very careful.
Why are you against wholesale concession of the airports?
I will keep saying this, don’t concession aeronautical side. Out of the 22 airports that FAAN is managing, 12 are joint user with the military. And that is why I am emphasising that we should not concession the aeronautical because the are jointly used by the military and civilian population. So, if you give it to someone from outside, and the military wants to fly and something happens, then there is a problem. We must never forget that airports are part of the assets of national power. We have to be very careful.
Are you not worried that the issue of MMA2 is still unresolved, and the government is even going ahead to start with the process?
Yes, there are some concessions that are already there, but we should be clear on what would become the status of these concessions within the new ones that we want to do. The $3b someone wanted to put down for MMA, what will be the position of all these concessions within it? These are issues that we need to sit down to iron out. Call stakeholders together to dialogue because it is really not a court matter.
Right now, what is the revenue of MMA? Before you concession, you have to know your revenue. You have to decide whether the $3 billion that someone wants to give you meet your revenue expectations. So far as I know, the revenue from MMA is enough for me to give government N30 billion every year, provided the aeronautical side is not part of the concession. That, I am talking of the landing and parking. But in terms of passenger service, international is $50 per head. And that is not small money with about two million passing the place every year. Also, the car parks, toll gate, all these terminals and land rents are all big money. Sum up all these, even if you remove MMA2, General Aviation Terminal (GAT), though they will pay rent, you should be collecting between N65b to N70b every year. Out of that, you can give government N30b and take N30bn, that is 50-50 sharing. That is why I said they have to audit the airports; know it’s true worth before giving them out.
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