FG Set To Abandon Another Airport

Dutse-International-Airport

The N11 billion brand new Dutse International Airport ticks all the boxes of what an airport in a developing country ought to look like apart from the most important option: serving as a hub for aeroplanes carrying people and goods. 
Critics expect that within the next decade or two, the airport will disintegrate into the same pitiful state that most of the airports in Nigeria are in. And they may well be right.

The airport sits between the busier Mallam Aminu Kano Airport, located about 100 kilometres away, and the Abubakar Tafawa Balewa Airport in Bauchi State, located some 200 kilometres away.

This means that it exists only to serve Jigawa, a state not particularly known for a thriving commerce or a huge population of affluent citizens.

This scenario is not very funny to the new state government which finds itself saddled with a crippling debt profile.

There is an urgent need to find ways of getting planes to actually land in and take off from the airport. The airport was billed to serve as a perishable cargo hub in the region.

The federal government, which insists on keeping airports on its plate, has simply ignored the Dutse Airport while it concentrates on the more commercially viable and busier airports in Abuja, Lagos and Port Harcourt.

Without appreciable revenue coming from the airport in Jigawa, the state may wait for a long time before it gets reimbursed by the federal government. As this wait stretches out, the rot will set in.

In an era where governments all over the world are selling their airports to private investors, it is a wonder that Nigeria has continued hanging on to several airports that are just left rotting away.

Though potentially lucrative, airports are capital intensive projects, and this is why governments around the world are selling them. Japan is selling 30-40-year concessions to run some of its airports; France sold a 49.9% stake in Toulouse Airport to Chinese investors last year.

According to The Economist, the valuations are reaching crazy heights too. Ljubljana airport in Slovenia was sold last year to German investors for 20 times annual earnings.

PricewaterhouseCoopers (PwC) reveals that the number of passengers is growing twice as fast at many Asian and African airports. The Asians seem to be capitalizing on this trend while we slumber.

According to Preqin, a data firm, while Europe accounts for more than half of airport deals since 2011, Asia comes second at 15%, ahead of Australia at 14% and America at 9%.

It is time that the federal government began to offload these airports so that private investors looking to make profits can unlock their potential and lift them off the ground.

Nigeria is largely an agrarian nation with a huge population that lacks basic travel infrastructure such as functional railways and good roads. The potential is there, but the will is not.

However, should the present government decide to keep airports on the Exclusive List, then it would do well to give them more attention.

Airports have a dual income stream, generating revenue both on the aeronautical side (landing fees) and from passengers (parking fees, shopping, hotels). What this means is that a little bit of commitment from the federal government and the host states can turn our airports into lucrative ventures.

Providing much-needed agricultural implements and agro-chemicals to states like Jigawa improves their capacity to produce cargo that can be lifted from airports.

Cutting down freight costs will also encourage farmers to access more markets with perishable cargo via faster travel options such as flying. Unlocking the vast tourism potentials of our states will also get more people travelling to discover Nigeria.

Cutting down on security bureaucracy will, for example, enable people seeing their loved ones off to enter the buildings and shop.

All this, as well as cutting capital costs and increasing prices of services such as parking in airports, will help unlock the potential in them.

Well-run airports can guarantee mouth-watering revenue being that an airport is practically a monopoly. And all the government really needs to do is to get more people and goods entering those terminals.