Buhari decries poor investment in aviation infrastructure

Posted on by Wole Shadare

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 Despite the huge potentials in air transport sector, President Muhammadu Buhari said Nigeria has not done well in the area of aviation infrastructure.
 
The President made the disclosure  at the opening of the International Civil Aviation Organisation (ICAO) World Aviation Forum in Abuja said the sector needs to be ready for exponential growth as predicted by the International Air Transport Association (IATA) which puts current forecast air transport growth in the sector to double in the next 20 years.
 
 It would be noted that $4.5 billion was invested in aviation infrastructure in Nigeria in 2016, as against about N15.3 trillion ($50 billion) needed to develop the sector optimally.
 
 Buhari, who was represented by Vice President, Yemi Osinbajo, noted that aviation remains an economic force with growth in the coming years guaranteed. 
 
Current forecast indicate that the market volume would double in the next 20 years, characterised by 4.6 per cent annual growth rate for passenger traffic and 4.4 per cent for freight traffic.
 
 He also observed the total economic impact of global aviation industry reached $2.7 trillion and some 3.5 per cent of the world’s Gross Domestic Product in 2014.
 
He noted that the air transport sector also supported a total 62.7 million jobs in the world, with 9.9 million direct jobs, with airports, airlines, air navigation and others employing three million people also in 2014.
 
His words, “While everyone agrees that the growth of aviation will be good for intra-Africa trade, integration and improve economies of African countries, there is little commitment to financing aviation infrastructure in Africa beyond mere words. 
 
 “The evidence is that it is difficult for aviation stakeholders and even states to access financing to build or rehabilitate airports, telecommunications equipment, meteorological infrastructure and cargo warehouses among others,” he said.
 
  The president added that most worrisome in the development programme of Africa countries, including the New Partnership for African Development (NEPAD), is the lack of priority for aviation infrastructure development.
 
  Buhari, however, called for improved collaboration of stakeholders at the forum, to come forth with practical steps to ensure that African aviation is not left behind in the growth story.
  One of the collaborators in the aviation infrastructure development drive and sponsor of the forum, African Development Bank (AfDB), emphasised need for investment in critical infrastructure like aircraft, estimated to the tune of N45.9 trillion ($150 million) dollars in the next 50 years.
 
 President of the Bank, Dr. Akinwunmi Adesina, reiterated that air transport promotes trade, investments and tourism, and boosts economic growth. 
 
 “Today, Africa’s aviation industry adds $73 billion to the continent’s annual GDP and employs about seven million people – an average 130,000 people per country in Africa. And that’s a lot!
 
  “With rapidly increasing population, urbanisation and income growth for the middle class, the aviation industry is projected to grow by five per cent annually for the next 20 years. From serving 120 million passengers in 2015, the industry will triple and serve over 300 million passengers by 2035. That’s the good news!”
 
  However, African countries must first address issues of expensive air fares, high taxation, connectivity, airport infrastructure and safe skies, especially the need for new and well maintained aircraft.
 
  Adesina said it is no longer acceptable to have Africa as the riskiest of skies to fly in. “While Africa accounts for only 3.4 per cent of all flight departures, it represents over nine per cent of all air accidents and 37 per cent of total global air fatalities. Among the 200 airlines blacklisted by the European Union, more than 50 per cent are African! These are shocking and non-acceptable numbers. 
 
  “The reasons are several: old, poorly maintained and inefficient aircrafts, poor safety standards, weak navigation systems, traffic management and generally weak inspection and oversight, and non-compliance with safety audits. These must change! Air travel must be safe – and safety should never be compromised!
 
  “Africa needs to procure about 970 jets and 700 turboprops over the next 20 years. Financing needs will exceed $150 billion! African aviation needs fleet modernisation, efficiencies, better connectivity and much improved quality of services for an exponential growth in the number of passengers,” he said.
 
 In his welcome address, Minister of State for Aviation, Hadi Sirika, citing the Nigeria Integrated infrastructure Masterplan (NllMP), said no fewer than $775b is required to develop Nigeria’s transportation infrastructure over the next 30 years.
 
 Sirika noted that Nigeria, by its geography is strategically located In the Gulf of Guinea, equidistant from most locations in Africa with a population of 173 million people and accounts for about 50 per cent of West African Population.
 
  Notwithstanding this potential, he said it is sad to admit that there to absence of a strong air carrier, major Maintenance Repair and Overhaul (MRO) centre, an efficient world class airport or even a significant catering company. 
 
 “Nigeria is positioned to take advantage of this opportunity. I strongly believe that Nigeria is the place to put your money not only because we moved up 24 places in ease of doing business recently but more so because the Rate of Return on investment is 34 per cent; one of the highest in the world.”
 

 ICAO President, Dr. Olumuyiwa Aliu, added that given the humongous investment demand, African countries must also put in place consistent policy that aligns with global standard, institutional legal and regulatory framework to encourage investors and invest in soft infrastructure like human capital development through education and training.

Wole Shadare