The campaign by the Federal Government to concession the five major airports in the country has been on for almost a decade. At each stage of the exercise, the scheme has met with frosty response from airport workers, especially staff of the Federal Airports Authority of Nigeria (FAAN) and industry unions.
Their rejection of the plan was primarily due to lack of the alleged transparency on the part of the Federal Government through the supervising ministry – Ministry of Aviation and Aerospace Development.
For eight years, Sen. Hadi Sirika, the immediate past Minister of Aviation, failed to implement the programme despite getting the approval of the Federal Executive Council (FEC) to commence the scheme. The government went as far as proposing between 20- and 30-years period for the concession of the concerned airports; Murtala Muhammed Airport (MMA), Lagos; Akanu Ibiam International Airport (AIIA), Enugu; Aminu Kano International Airport (AKIA); Nnamdi Azikiwe International Airport (NAIA), and Port Harcourt International Airport (PHIA) in Port Harcourt.
The then minister also told journalists that infrastructure concessions of this nature come with a significant financial obligation, stressing that in order for the concessionaires to recoup their investments; the concession period would be between 20 to 30 years tenure and may be extended in a Build, Operate and Transfer (BOT) model. He further assured that the government complied fully with the guidelines of the Infrastructure Concession Regulatory Commission (ICRC) in concessioning the airports.
Also, in a media advertisement on the concession scheme, Sirika said that the Request for Qualification (RFQ) to run the facilities efficiently and profitably was open to firms or consortia with track records in airport terminal management and net worth of N30 billion per bidding firm or consortium.
As at May 2023, four of the five airports, apart from Port Harcourt International Airports had been concessioned to “successful bidders,” but with protest from various quarters stalled the process. For instance, SIFAX Group of Companies Ltd in 2022, approached a Federal High Court in Lagos, to disqualify Tav Airports Holding Company and GMR Airport Limited and also sued the Federal Government and the Ministry of Aviation in its attempt to quell the plan.
SIFAX Group had claimed that both firms, owned by the same company, Airport De Paris (ADP), submitted separate bids for the Murtala Muhammed International Airport (MMIA), Lagos and were shortlisted for the next phase of the concession. But, since the advent of the new regime, nothing is heard again about the legal tussle.
However, when Festus Keyamo, the Minister of Aviation and Aerospace Development came onboard in August, he took the bold step to suspend the controversial national carrier and airports concession projects, the two of the six aviation roadmaps of his predecessor. According to him, the two projects needed to be looked into once again due to the controversies they had generated from inception till date.
He declared that before the current administration would take a decisive decision on the two, there was the need for President Bola Tinibu to be fully briefed on the development. He insisted that as the minister, he was responsible for the feelings of Nigerians and assured that due diligence would be followed by the government.
He said: “We have only suspended some things that we keep on complaining about. We are very responsive to the feelings of Nigeria. If something is good, but it is not transparent, Nigeria people must know the processes by which you give out their commonwealth. It is the commonwealth of Nigeria and Nigerians must be aware of how you give out their commonwealth in the name of concessioning.
“It should not be kept secret. Tell the National Assembly who is oversighting us and tell the Nigerian people too and let them know through you that this process was transparent and we got the best deal for Nigerians and that is why I have directed that all of those concessions should be suspended until I brief Mr. President.”
However, news filtered out a few weeks ago that Keyamo had planned concessioning of Enugu airport for 80 years without the knowledge and input of stakeholders and unions. Reports were rife that the Federal Government was planning to concession the airport for 80 years.
In fact, a 56-page draft concession agreement between the Federal Ministry of Aviation and Aerospace Development/Federal Airports Authority of Nigeria (grantor) and Aero Alliance Consortium (concessionaire) under a Public-Private Partnership (PPP) arrangement surfaced in the public space.
According to the document, the government had allegedly planned to concession the airport for an 80-year period, a claim the government through Keyamo, vehemently denied, citing numerous reasons.
Majority of the industry experts and unions were taken aback by this discovery, claiming that they were not aware of the plan. But, Keyamo through Mr. Tunde Moshood, his Special Adviser on Media and Communications, declared the reports of Enugu airport concession for a “lengthy period” as completely baseless.
While he agreed that the government was considering proposals for concessioning of the airport, just like the others, he was, however, not explicit on the tenure of the proposed agreement, saying that “a certain lengthy period of concession” had not been agreed upon regarding the airport.
He said: “Whilst it is true that the Federal Government is considering proposals for the concession of five major airports, this is a proactive measure to ensure these vital facilities can meet and maintain international standards, given the increasing financial demands of their operations. Many of our airports are presently running at a loss, so they have to be subsidised each month by the Federal Government. It is noteworthy that this initiative to concession started from previous administrations.
“At this stage, prospective concessionaires have indeed submitted various proposals, including different durations for the concession. It is important to emphasise that the Ministry of Aviation and Aerospace Development has not established any fixed duration. All submitted proposals are currently undergoing thorough evaluation that will eventually be reviewed by the Infrastructure Concession Regulatory Commission (ICRC) before it is presented to the minister for conveyance to the Federal Executive Council (FEC) for approval.
“We can confirm that this review process has not been concluded. However, for the sake of transparency, the Honourable Minister of Aviation and Aerospace Development, Festus Keyamo, directed, some months ago, that the aviation labour unions be included as part of the negotiating teams.”
Besides, the Enugu State Government said the concession process for the airport has reached over 70 per cent completion, hoping that the entire process would be concluded by the second quarter of 2025.
The State Government expressed that the upgrades would include the completion of the international terminal, cargo terminal, maintenance, repair, and overhaul facilities, aircraft hangars, and runway extension.
Investigation by our correspondent revealed that Enugu airport’s annual passenger traffic has continued to waver between 350,000 and 500,000 in the last one decade, yet its revenue generation to the coffers of FAAN in 2024 was merely N3,617,003,400.91. This figure shows just 0.9 per cent of total revenue generation of N382,149,045.15 for FAAN in 2024.
The above statistics, show that the airport is among the 16 out of the 20 in the country that are drain pipes on the finances of FAAN, despite the continuous humongous amount of money spent on its upgrade annually by the Federal Government. Also, in the last decade, the Federal Government had spent at least N15 billion on the remodelling, upgrade and extension of the airport’s facilities, including its runway.
For instance, former President Muhammadu Buhari, had in 2019, approved the sum of N10.3 billion as intervention fund for the rehabilitation of the airport in 2019, while earlier, Princess Stella Oduah, another minister in the sector, had as part of the $500 million loan secured from China, remodelled the airport facilities before its reopening in 2014.
Since the issue gained traction in the media, different schools of thoughts have commented on it with many giving different analyses.
Mr. Bankole Bernard, the Group Managing Director (GMD), Finchglow Holdings, said that it was important for the Federal Government to critically look at the past efforts of concessioning some of the airports and the outcome of such exercise.
He stated that the government had not shown any sign of seriousness in its airport concession scheme, but insisted it would go a long way in improving the current “shameful terminals” across the country.
He said: “When we are talking of the concessioning of airports, we have to look historically. The concession that we have made in the past, what is the outcome? Is there any legal implication to it? I know that there are still legal battles between the Federal Government and the Bi-Courtney Aviation Services Limited (BASL) on the concession that was granted to the company. So, you think as an international financier, I will want to come into that environment?
“I think we are just dancing to the gallery on this airport concession issue. The government before now, spoke about concession for eight years and it’s gone. This government too is talking about concession, in the next few weeks, it will be two years and in the next two years, you won’t talk about concession again because it will be all about elections, except the election is now concessioned.”
Capt. Peter Adenihun, aviation stakeholder, said that concession of an airport where a private entity takes its management and operation could be a good idea with potential benefits like increased efficiency, improved services and attracting investment. He also said that the scheme comes with its risks, which include potential conflicts of interest, lack of transparency, and the possibility of increased costs for users.
Adenihun, expressed that the success of an airport concession depended largely on careful planning, transparent negotiations and effective monitoring to ensure that the public interest was protected while also allowing for private investment and improved airport operations.
He, however, challenged the government to make public the concession documents, processes, benefits to Nigerians and the country’s gain from such exercise. “Private companies are often more adept at managing operations and providing services due to their experience in the commercial sector, potentially leading to better customer service, faster processing times, and increased efficiency in various airport functions. “Private investment can help modernise airport facilities, upgrade infrastructure, and bring in new technologies, ultimately improving the overall user experience and attracting more passengers, he said”.
Grp. Capt. John Ojikutu (retd), aviation analyst, expressed support for concession of all airports, but said the major focus should be on the non-aeronautical commercial services and not aeronautical services especially at the joint users’ airports with the military.
He said that the selection of bidders for airport concessions should be made public to douse tension and boost, while the contractual sum must also be in the public domain. “What are the generated revenues of the Enugu airport and what is the government expected from the investment on it? We need to know how much revenue is generated now at the airport and how much will be generated by the company and what percentage of the revenue the government is expecting,” he added.
Also, Dr. Austin Okolie, a management consultant, said that no single tier of government could single-handedly carry the financial and operational burden of sustaining, upgrading, and expanding critical infrastructure like an international airport in which Enugu airport is a prime example.
Okolie explained that despite its designation as one of Nigeria’s five international airports, the airport had remained only partially completed and not yet fully operational to international standards, adding that its operational efficiency was constrained. He argued that globally, airport concessions typically range from 25 to 30 years, but said this is for fully completed and operational airports, maintaining that AIIA demanded not only significant capital for full development, but also long-term runway maintenance and performance guarantees.
He added: “Therefore, the proposed terms account for the scale of investment, the long asset recovery cycle, and the need to ensure consistent, high-quality service delivery over time. This is not an arbitrary number – it is based on global benchmarks and justified by the scale of the work required. “Consequently, while some concerns and healthy discourse are quite welcome, it is also imperative to separate fact from fear. This is not a backdoor sale. It is not a loss or the end of our regional pride, AIIA. It is, in fact, the beginning of a better, bolder era for Southeast aviation – one that ensures the airport finally works for our people, our businesses, and our future. It is about regional prosperity, job creation, trade enablement, and infrastructure transformation.”