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FG loses N7b, others also count cost of 6-week closure as Abuja Airport reopens

By News Express on 16/04/2017

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•Abuja Airport runway at night.
•Abuja Airport runway at night.

As Nigerians await reopening of the Nnamdi Azikiwe International Airport (NAIA), Abuja, this Thursday, there are indications the nation may have expended over N10b in project cost and revenue losses in the six weeks the airport was closed for the rehabilitation.

The airport billed to open for flights this week, was closed on March 9, while flights were diverted to Kaduna International Airport.

Major losers during the temporary closure are the Federal Airport Authority of Nigeria (FAAN), Abuja hotels, owners of businesses in the airport and other stakeholders, including taxi drivers, who depend on the airport for survival.

Abuja airport manager, Sani Mahmud told The Guardian that they are still calculating the FAAN’s losses during the closure, saying the details would be made known to the public when the airport resumes.

On the part of the Federal Government, the closure may have cost about N7b, which include the N5.8b budgeted for the runway repairs and N1.134b spent on logistics for traffic diversion to the Kaduna International Airport (KIA).

Other loses that may not be immediately accounted for are drop in revenue on account of foreign carriers that suspended Abuja operations and aviation ancillary services that had a downtime, while the closure lasted.

The Nigerian Civil Aviation Authority (NCAA) has, however, justified the cost, saying it was an extra care on the part of government to give Abuja-bound traffic an alternative aerodrome.

According to an estimate offered in preparation for the airport closure, the Nigerian Railway Corporation gulped N100,326,400; Federal Road Safety Commission (FRSC) took N237,247,216.21, while the Nigeria Security and Civil Defence Corps (NSCDC) took N325,000,000.

A total of N358,517,700 was allocated to the Nigerian Police Force, while the Nigeria Immigration Service took N29 million. The Ministry of Aviation also hired buses for N84 million, which brings the total figure to N1.134b.

Industry watcher, Enitan Akinlabi, said a huge fraction of the estimated sum and other taxes that ordinarily go to the Federal Airports Authority of Nigeria (FAAN) and NCAA among others, would have been saved if the airport was not closed and the runway adequately maintained.

Akinlabi said the regulatory agencies would have lost some royalties in Abuja, especially from the international carriers, since local operators diverted to Kaduna.

He, however, added that the matter bothered on safety and “in aviation no cost is too much to prevent a mishap.”

Spokesperson of the NCAA, Sam Adurogboye, said any lose whatsoever is not really that of the government, rather for the foreign airlines that refused to divert to Kaduna based on valid business decision.

Adurogboye added that the most important consideration for NCAA is safety and not what is lost or gained during the rehabilitation.

He said NCAA approved the closure in line with International best practice to avert possible disaster that would have been disastrous for the country.

President of the National Association of Nigeria Travel Agencies (NANTA), Bernard Bankole, who did not disclose the accompanying cost of the closure, said the rehabilitation work addressed safety issues and national embarrassment on account of the erstwhile bad runway.

While he commended the rehabilitation exercise and on time completion, the NANTA president said work on the second runway should immediately commence.

The General Project Manager of Nnamdi Azikiwe Airport, Engr. Abiola Adejare said FAAN would not compensate owners of businesses at the airport for their loss during the closure, saying the airport was not totally shutdown.

He explained that it was only the runway that was shut down adding that passengers still come into the airport and patronise some of the businesses in the airport before boarding free buses to Kaduna airport.

It was learnt that shops selling recharge cards inside the terminal building pay rent of N200,000 annually to FAAN, each Kilichi sellers (dry meat) pay N120,000 annually, airport taxis pay N40,000 annually, while payments by company handling trolley service run into millions of Naira.

An airport taxi operator, Gabriel Anjorin lamented that life has been tough for him since the closure of the airport.
He said: “Take for instance, yesterday, after waiting at the airport till 10pm, I was able to get my first passenger and got home around 12pm and just went to bed. Before we use get at least three to four passengers daily, but now there are plenty drivers scrambling for few passengers, some days I don’t even get any passenger to carry.
Thank God its remaining three days to the opening of the airport, hopefully things will pick up by then.”

For the hotels in the Federal Capital Territory, it was bad business due to the closure.
General Manager, Reiz Continental Hotel Abuja, Ray Opara told The Guardian that March is often one of their peak periods, saying it was sad that the airport closure took place during the month.

He said: “What has happened to us is that most events that were supposed to hold last week have been rescheduled to May and June. They want government to complete the rehabilitation of the airport, they don’t want to go through the hassle of landing in Lagos, then go to Kaduna, and then travel from Kaduna to Abuja by road for another four hours. I don’t even know how we are going to pay salaries for this month.”

General Manager of AES Luxury Apartment, Dipo Oluyemi put their loss during the period of closure at N45m, saying patronage dropped by over 45 percent. Similar situation played out at Ibeto Hotels, where sales went down to N1.5m from N3m daily.

A restaurant owner at the Abuja airport also lamented loss of business. She said prior to the closure she used to record N50,000 daily sales, but noted that since the closure most of the passengers who came to join free buses to Kaduna didn’t bother to visit restaurants.

Meanwhile, officials of the Kaduna International Airport have expressed satisfaction with the gains from the diversion of Abuja flights, though concerned that it might not be sustainable once NAIA reopens.

According to official records, over 3,533 flights and 170,150 passengers were recorded within the period.

Already, the authorities are putting in place elaborate plans to boost flight operations after the return to status quo. (The Guardian)

Source News Express

Posted 16/04/2017 08:46:47 AM


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