Why finance institutions don’t fund aviation infrastructure-ICAO
- Lagos, Abuja certification to raise passenger traffic to15 million annually- SGF
President of global aviation regulatory body, the International Civil Aviation Organisation (ICAO), Dr. Bernard Olumuyiwa Aliu said Nigeria and many African countries lack proper aviation infrastructure because of the risk associated with a lack of sufficient institutional, legal and regulatory enabling frameworks which makes it very difficult for financial institutions to invest in airport projects.
He stated that for states with limited access to investment finances, it is critical to include major airport infrastructure needs in the priority list of international public finance and assistance for development projects.
To him, no investor wants to project out their proposed returns based on one eventuality, only to see those goal posts being moved by a government half way through a project after they have made their financial commitment.
His words, “The priority in this list is for airport operators, in coordination with states, to clearly demonstrate where financing is required. This can be accomplished through gap-analyses of forecast demand, future capacity need and current infrastructure deficiencies”.
The ICAO reiterated that chief revenues raised via passenger charges and taxes are often significantly outweighed by what a state will lose out on in terms of more broad-based economic growth, largely as a result of the dampened demand for air travel and air cargo shipments which he stated these charges lead to.
“It is therefore important to seek to complement aeronautical charges with a variety of non- aeronautical revenues”, he added.
Many financial institutions in Nigeria particularly have shunned investing in the country’s aviation sector because of frequent changes in government policies which have in turn ruined their investments and left them losing huge sums of money.
He stated that aviation has become a catalyst for sustainable social, economic and human development, directly and indirectly supporting 6.8 million jobs and generating $72.5 billion in Gross Domestic Product (GDP)
He stated that airports serve as veritable gateways to this development and prosperity, facilitating the connectivity, tourism and trade which in turn foster economic growth and new opportunities all over Africa today.
This is coming as the Secretary to the Federal Government, Boss Gidado Mustapha stated that certification of two of the nation’s key airports, Murtala Muhammed International Airport Lagos, Nnamdi Azikiwe International Airport Abuja and construction of five new international terminals (Lagos, Abuja, Kano, Port Harcourt and Enugu) would lead to 15 million traffic annually from about seven million last year’s traffic for international passengers.
Mustapha equally stated that majority of Nigeria’s airport infrastructure are government-owned, stressing that government has continued to promote infrastructural development, facilities renewal and the implementation of policies aimed at facilitating the growth and sustainability of the sector.
The duo spoke at the 59th Airports Council International (ACI) African Regional Conference with theme, “Sustainable Development of African airports, New Strategies”, which was held in Lagos yesterday.
He noted that for these strategies to work, these strategies must include holistic planning for defined development targets; effective and efficient financing plan and successful implementation, noting that the role of partnership with the private sector cannot be over-emphasised.
To achieve, scribe to the Federal Government said concession of four International Airports as well as the establishment of Search and Rescue Unit would be implemented through Public and Private Partnership (PPP), reiterating that the full implementation of the Aviation Roadmap which is progressing in line with milestone targets will result in the transformation of business and economic growth in the sector.
His words, “Airport Council International and the Federal Government of Nigeria are in sync on the development of the aviation industry in Africa. The full implementation of the Aviation Roadmap which is progressing in line with milestone targets will result in the transformation of business and economic growth in the sector. Government therefore eagerly awaits the comma of your deliberations and actionable points. This administration is committed to attracting investors and investments into Nigeria and is providing appropriate legislation, infrastructure and security to protect them”.
In his welcome address, President of ACI Africa and Managing Director of Federal Airports Authority of Nigeria (FAAN), Saleh Dunoma said the Nigeria’s relationship with ACI Africa spans over a decade and it has been a mutually benefiting.
Dunoma said, “AC1 Africa works with its members and also liaises with other International bodies like ACI World, ICAO etc to ensure improved human capacity development by providing various standard and customised trainings in different skill areas to ensure safe, secure and efficiently managed airports.
“Last year, Nigeria signed the agreement to become one of the ‘ AC1 global training centers, to further advance the goal of human capacity development in FAAN and in Africa. The first training after the agreement was conducted in December 2017 where Nigeria received participants from other African countries.
“Over the years, ACI Africa had focused on safety as a priority leading to the initiation of the world wide acknowledged Airport Excellence (APEX) in safety programme. This has recorded great achievements as major airports continue to requests for this programme.
“Nigeria has been in the forefront in striving to attain the highest levels of safety standards; hence with the assistance of the APEX in safety programme, we were able to achieve the
certification of our two busiest airports.
“Our goal is to certify all our international airports and we are working tirelessly to achieve that, hem we have taken the bold step to carry out the APEX in safety programmes in our international airports.”
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