The long wait for concession

The Federal Government’s plan to concession the Akanu Ibiam International Airport in Enugu has been met with mixed reactions, with some stakeholders questioning the need for such a move. Despite the airport’s relatively low revenue generation of N3.6 billion in 2024, which is only 0.9 per cent of the Federal Airports Authority of Nigeria’s (FAAN) total revenue, the government is determined to push through with the concession plan.

The airport has received significant investment from the Federal Government, with at least N15 billion spent on its upgrade and expansion over the last decade. In 2019, former President Muhammadu Buhari approved N10.3 billion for the rehabilitation of the airport, and earlier, Princess Stella Oduah, a former minister, had also invested heavily in remodeling the its facilities. These investments have raised questions about the need for concession, with some stakeholders arguing that the airport’s financial struggles are not due to a lack of funding, but rather poor management.

A 56-page draft concession agreement between the Federal Ministry of Aviation and Aerospace Development/FAAN and Aero Alliance Consortium surfaced in the public space, sparking controversy. According to the document, the government had allegedly planned to concession the airport for an 80-year period. However, the Minister of Aviation and Aerospace Development, Festus Keyamo, vehemently denied the claim, stating that the government had not agreed on a specific concession period.

The concession plan has sparked debate among stakeholders, with some arguing that it would improve the airport’s efficiency and attract investment. Mr. Bankole Bernard, the Group Managing Director of Finchglow Holdings, said that the government should critically examine the outcome of past concession efforts before proceeding. He noted that the government had not shown any seriousness in its airport concession scheme and that the plan might not yield the desired results.

Dr. Austin Okolie, a management consultant, argued 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. He said that airport concessions typically range from 25 to 30 years and that the proposed terms would account for the scale of investment, the long asset recovery cycle, and the need to ensure consistent, high-quality service delivery over time.

Capt. Peter Adenihun, an aviation stakeholder, said that concession of an airport could be a good idea, with potential benefits like increased efficiency, improved services, and attracting investment. However, he also noted that the scheme comes with risks, including potential conflicts of interest, lack of transparency, and the possibility of increased costs for users.

The Enugu State Government has expressed optimism about the concession process, saying that it would lead to upgrades, including the completion of the international terminal, cargo terminal, maintenance, repair, and overhaul facilities, aircraft hangars, and runway extension. The state government expects the concession process to be concluded by the second quarter of 2025.

As the concession plan hangs in the balance, stakeholders are eagerly awaiting the outcome. While some have expressed support for the concession, others have raised concerns about the potential risks and benefits. The government must carefully consider the implications of the concession plan and ensure that the public interest is protected.

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The concession of the Enugu airport is not without precedent. The Federal Government has attempted to concession major airports in the country in the past, with mixed results. The success of the concession plan will depend on careful planning, transparent negotiations, and effective monitoring to ensure that the public interest is protected while also allowing for private investment and improved airport operations.

One of the key concerns raised by stakeholders is the potential impact on the local economy. The airport plays a critical role in facilitating trade and commerce in the region, and any disruption to its operations could have significant economic implications. The government must therefore ensure that the concession plan is designed in a way that minimises risks and maximizes benefits for the local economy.

Another concern is the potential impact on airport staff and workers. The concession plan could lead to changes in the workforce, including potential job losses or changes in working conditions. The government must therefore engage with airport staff and workers to ensure that their rights and interests are protected.

In conclusion, the long wait for a concession continues as the Federal Government’s plan to concession the Akanu Ibiam International Airport in Enugu hangs in the balance. While some stakeholders have expressed support for the concession, others have raised concerns about the potential risks and benefits. The government must carefully consider the implications of the concession plan and ensure that the public interest is protected. The success of the concession plan will depend on careful planning, transparent negotiations, and effective monitoring to ensure that the public interest is protected while also allowing for private investment and improved airport operations.