Transcript ENHANCING PRIVATE SECTOR PERTICIPATION

ENHANCING PRIVATE SECTOR
PARTICIPATION-NIGERIAN AIRPORTS
A Presentation by Engr. Saleh Dunoma, Managing
Director/CEO of Federal Airports Authority of Nigeria, at the
Nigeria Infrastructure and Building Conference, Lagos.
27th September, 2016.
OUTLINE

Introduction

Challenges and Government’s commitments

Investment needs and opportunities

Gains of PPP

Conclusion
INTRODUCTION

Air transport lies at the heart of global business and
tourism

The Aviation sector comprises distinct types of
activities:
 Airline:
 The
which transports passengers and freights;
Ground-based infrastructure: these include the
Airport facilities, services provided for passengers at the
Airports, baggage handling, ticketing, catering, retail
and such other aviation related services.
NIGERIAN AIRPORTS: WHO WE ARE

FAAN manages 22 Airports in Nigeria

Provides services in 9 State owned and private Airports, including the
Domestic Terminal 2 (MMA2), operated by Messrs Bi-Courtney Ltd.

Four major International Airports well spread across Nigeria; MMIA Lagos,
NAIA Abuja, MAKIA Kano and PHIA Port-Harcourt.

We have twenty Cargo Terminals under the remodeling/infrastructure
improvement project.

Great business potentials in the different geographical regions
Passenger throughput across Nigeria
OUR EXPERIENCE

The Domestic Terminal 2 (MMA2) managed and
operated by Bi-Courtney Ltd;

Other concessions;

Lessons learnt: need to ensure provision of guarantee
for investors by compliance with the regulatory
framework and regime as provided in the ICRC Act;

Engage International Transaction Advisors & prepare
world class Agreement in line with ICRC Guidelines for
PPP.
OUR CHALLENGES
Infrastructure deficit in our Airports and the urgent
need for replacement
 Scarce resources and Funding challenges
 Cost of borrowing/Bank interest rates
 Bureaucracy
 Policy somersault (now a thing of the past, as the
Government is ready to implement the regulatory
framework
and
mechanism
that
demands
transparency, open competition & cost effectiveness).

Political Commitment

EXCERPTS OF SPEECH BY
PRESIDENT MUHAMMADU BUHARI
ON AUGUST 23, 2015

“We also have a huge infrastructure deficit for which we
require foreign capital and expertise to supplement whatever
resources we can marshal at home. In essence, we seek public
private partnerships in our quest for enhanced capital and
expertise.”
32


OUR EXPECTATIONS & INVESTMENT NEEDS
The National Integrated Infrastructure Masterplan (NIMP) requires an expenditure
of $3.10 Trillion (USD) over a period of 30years. The private sector is expected to
inject about 48% of this sum through PPP.

The first 5year Investment focus will be $11bn (USD) for the Transport sector as a
whole.

$5b (USD) is projected for the
Aviation sector.

Source: National Planning Commission
INVESTMENT OPPORTUNITIES
►
Management of the passenger Terminals.
►
Improvement and management of Cargo Terminals (Wet and Dry
Cargo).

Construction of Second Runway and New Terminal Buildings at
NAIA Abuja and other Airports.

Improvement and supply of sustainable Power to the Airports:
some parts of Nigeria have at least 200 days of sunshine which
can be converted to solar power by Investors.
INVEST. OPPS. CONTD.

The MULTI LEVEL CAR PARK UNDER CONSTRUCTION BY PRIVATE
INVESTORS AT THE MURTALA MUHAMMED INTERNATIONAL
AIRPORT TERMINAL, LAGOS.
INVEST OPPS. CONTD.

Construction and provision of Inter-terminal Rail Network Service

Development of MROs - Hangars

Development of Hospitality facilities
NEW TERMINAL BUILDING, MURTALA MUHAMMED INTERNATIONAL AIRPORT, LAGOS
NEW TERMINAL BUILDING, PORT- HARCOURT INT’L AIRPORT, PORT-HARCOURT
NEW TERMINAL BUILDING, NNAMDI AZIKIWE INTERNATIONAL AIRPORT, ABUJA
NEW TERMINAL BUILDING, MALLAM AMINU KANO INTERNATIONAL AIRPORT, KANO
INVEST OPPS. CONTD.

Nigeria is strategically located on the Map.

This strategic location can be developed as a hub for
passengers and cargo movement.
SOURCE: EUROSTAT, OXFORD ECONOMICS
TEN YEARS FORECAST OF AIRCRAFT
MOVEMENT FOR FOUR INT'L AIRPORTS
2015
BASE
YEAR
2016
2017
2018
2019
MMIA 28,019
30,821 33,903 37,293 41,023
ABUJA 8,870
2020
2021
2022
2023
2024
2025
45,125 49,637 54,601 60,061 66,067
72,674
9,757
10,733 11,806 12,987 14,285 15,714 17,285 19,014 20,915
23,006
KANO 2,086
2,295
2,524
2,776
3,054
3,360
3,695
4,065
4,472
4,919
5,411
PHIA
2,473
2,720
2,992
3,291
3,620
3,982
4,381
4,819
5,301
5,831
2,248
TEN YEARS FORECAST OF AIRCRAFT MOVEMENT FOR FOUR
INTERNATIONAL AIRPORTS
80,000
Projected Aircraft Movement
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0
2015
BASE
YEAR
2016
2017
2018
MMIA
2019
ABUJA
2020
2021
KANO
PHIA
2022
2023
2024
2025
OUR GAINS UNDER PPP

Compliance with Due Diligence;

An opportunity for the use of appropriate technology and
innovation as well as good management;

Developing
local
private
sector
capabilities
competences;

Timely and on budget delivery of Projects;

Budgetary certainty and guarantee;
and
GAINS CONTD.

Provide an increasing opportunity for the private sector to
participate in service delivery;

Value for money;

Better allocation of risks between parties;

Sustainable maintenance program;

Standardized contracts with minimal errors
GAINS CONTD.

Ripple effect on the economy:

Turkey’s aviation sector contributed $3.88Bn (USD) in
2013 to the country’s GDP and supports about 204,000
in jobs.

Dubai contributed about $26.7bn (USD) in 2013 to GDP

Nigeria can do same because of our location in the
globe and our population
MURTALA MUHAMMED AIRPORT DOMESTIC TERMINAL 2 (Bi-Courtney Ltd)
17
PRIVATE HANGAR
PRIVATE HANGAR CONTD.
CONCLUSION

We invite Investors to join the PPP process for Airport management
and take advantage of the vast opportunities, and offerings in our
Airports.

Contacts: The Office of the Managing Director/CEO, FAAN.