Flight to nowhere: Nigeria loses N2trn annually to underutilized airports

By AYOOLA OLAOLUWA

Most airport projects across the country are currently lying fallow, as a result of low traffic and gross underutilization of their facilities, Business Hallmark investigations have revealed.

Several years after they were declared opened for commercial operations, most of them are now a shadow of themselves.

While their arrival and departure halls are largely under padlocks, the tarmacs are devoid of aircraft either coming in for landing or taking off. Also, ticket offices, body and luggage scanners, escalators, conveyor belts and car parks, among other facilities, are idle, with no passengers patronage.

However, our correspondent observed the normal compliments of staff in some of the airports visited. At the Ibadan Airport, visibly bored workers, comprising of security men, air traffic controllers, aircraft maintenance engineers, mechanics, baggage handlers, ramp staff and Weather Observing System staff (saddled with the provision of weather conditions) were observed either seating idle or busy chatting with nothing to do.

Meanwhile, all requisite agencies under the Ministry of Aviation, namely the Nigerian Civil Aviation Authority (NCAA), the Federal Airports Authority of Nigeria (FAAN), the Nigerian Airspace Management Agency (NAMA), the Nigerian College of Aviation Technology (NCAT), the Nigerian Meteorological Agency (Nimet)and the Nigerian Safety Investigation Bureau (NSIB) have functional offices and officers present in all the airports.

According to BH checks, Nigeria has 32 airports, made up of airstrips, airforce bases and commercial airports.

Out of this number, 26 are operated by FAAN, in which 13 are international airports. However, of these 13 ‘international’ airports, only five are functional international airports and recognized worldwide for global transportation by the International Air Transport Association (IATA) and International Civil Aviation Organization (ICAO).

They include the Murtala Mohammed Aiport Lagos (local and international), Aminu Kano Airport, Kano (local and international), Port Harcourt Airport (both local and international), Nnamdi Azikwe Airport Abuja (local and international) and Akanu Ibiam Airport Enugu (local and international).

The eight remaining are just international airports in name and are largely non functional. They are Sadiq Abubakar International Airport Sokoto; Kaduna International Airport; Margaret Ekpo International Airport Calabar; Sam Mbakwe International Airport, Imo State; Maiduguri International Airport; Anambra International Cargo Airport; Ilorin International Airport and Dutse International Airport, Dutse in Jigawa State.

They are only put to use during the yearly Christians and Muslims holy pilgrimages to Saudi Arabia and Jerusalem. After that, they rarely receive any international flight on their tarmacs until the following year.

The remaining 12 domestic airports operated by FAAN are Benin, Minna, Ibadan, Akure, Makurdi, Maiduguri, Jos, Yola, Katsina, Ilorin, Zaria and Osubi.

Aside these several airport projects are ongoing in states like Ogun, Osun, Ekiti and Lagos.

In 2022, the Nigerian Civil Aviation Authorities granted approval to 12 states like Benue and Nasarawa to build their own airports.

By the time all these airports begin commercial operations, the number of airports in the country will rise to over 45.

Most of the airports already in existence running commercial operations, findings revealed, are largely underutilized, with very low or almost no patronage. While the most active provincial airports operate one flight daily, other go weeks without having a plane touched down on their tarmacs.

However, the airports do receive occasional chartered flights, mostly during the burials of important dignitaries in their home states, or when there are major events like weddings, Dubar, turbaning and crowing of emirs and kings or political campaigns.

However, some financial and aviation experts, who spoke with our correspondent on the development wondered how building new airports have become priorities for states, when there are little or no patronage for the current ones in operations.

According to an airline pilot, Captain Tunde Murphy, states governments, and even the Federal Government must not rush into the business of owning airports as they are capital intensive.

“It appears that the priority project for every governor now is to build an airport in their states when almost all the ones currently operating do not make any economic sense.

“It still baffles me why Benue State will want to construct another airport at Kura, just 12 Kilometres from Makurdi when there is little or no patronage for the current one in Makurdi, the state capital.

“Building airports is capital intensive and so is their maintenance. Airports need permanent technical and administrative personnel, who must work to sustain the cost of their existence, even if they are not generating money.

“For instance, states like Ebonyi, Gombe, Katsina and Kebbi all built airports some years ago with state-of-the art facilities, but today, they barely have scheduled regular flights, except charter services”, Murphy said.

BH reliably gathered that apart from few airports like the MMA Lagos, Aminu Kano in Kano and Nnamdi Azikwe, Abuja originally constructed and owned by the Federal Government, about 70 percent of the airports like the Sam Mbakwe Airport, Owerri now operated by FAAN originally belonged to states before they were transfered to the Federal Government.

A top official in FAAN blamed politicians for forcing the airports on the agency. According to him, neither FAAN nor the Federal Government originally set out to own and operate the airports which are daily running at a loss.

“In fact, over 70 percent of the airports currently in operation were established by state government that got tired and hurriedly handed them over to the Federal Government in order to escape the burden the airports are putting on their finances”, the FAAN source confided in BH.

Based on IATA’s estimate, a modern airport requires at least five million passengers yearly to be viable.

However, BH findings revealed that only the Nnamdi Azikiwe International Airport, Abuja and Murtala Muhammed Airport, Lagos are viable and self-sustaining because they have sufficient local and international passengers to offset operational costs.

Other big airports like the Enugu, Kano, Port Harcourt, Owerri, Kaduna, Uyo and Calabar, it was learnt, amass huge operational cost and debts year-on-year without generating enough enough to show for it.

The financial situation of provincial airports like Ilorin, Akure, Ibadan, Kaduna, Jos, among others, are worse. The airports, it was learnt, are still working because of huge government subsidy.

For instance, a three-year account of expenditure (2017-2019) published by FAAN in 2022 showed that Katsina Airport earned N250.8 million in three years, but recorded an operational cost of N1.58 billion.

Also, Ibadan Airport earned only N349.2 million but spent N1.39 billion in three years, while Margaret Ekpo International Airport, Calabar, spent N2.5 billion on operations, but could only rake in N540.8 million in earnings in the three years under review. Other airports did not fare better.

Another document obtained from the Nigeria Civil Aviation Authority put passenger traffic in 2020 at 9,069,295, 14.2 million in 2021 and 16,173,361 in 2022.

Specifically, out of the 16,173,361 passengers airlifted in 2022, five airports, namely Murtala Muhammed International Airport, Lagos, Nnamdi Azikiwe International Airport, Abuja, Port Harcourt International Airport, Mallam Aminu Kano International Airport and Akanu Ibiam International Airport, Enugu were responsible for airlifting 89.7% of the total travellers

The other FAAN operated airports could only airlift 10.3%, passengers.

Out of the total 16m passengers airlifted in 2022, 12,668,741 were local passengers, while international passengers accounted for 3,504,620.

Meanwhile, the five mentioned airports shared 14,520,101 among themselves, leaving the remaining 1,653,260 travellers to the others airports.

Further analysis of the NCAA 2022 report showed that MMIA Lagos had the highest passenger volume with 6,526,023, representing 40.3 per cent of the total passenger volume, followed by the Nnamdi Azikiwe International Airport Abuja, which airlifted 5,985,596, representing 37 per cent of the total passenger movement.

Others are the Port Harcourt International Airport, which airlifted 915,247 passengers; Mallam Aminu Kano International Airport; 585,190 passengers and Akanu Ibiam International Airport, Enugu, 513,045 passengers.

Based on the IATA estimate that a modern airport requires at least five million passengers yearly to be viable, only the Lagos and Abuja airports were able to meet and surpass the target, with Port Harcourt Airport coming a distance third with only 915,247 passengers.

Speaking on the poor traffic volume of Nigerian airports, an aviation expert, Engr. Sola Ogundipe, maintained that more than 95 percent of Nigerian airports have no reason to still be in business.

“If only five airports are responsible for 90% of air passengers traffic, what this implies is that the others are recording less that 1%.

“Yet, all of them have full complement of agencies, workers and facilities needed to operate an airport.

“Nigerians, unfortunately, concentrate only on the nation’s four refineries, Ajaokuta Steel Company, fuel subsidy, and the multiple forex exchange windows as the drain pipes on the nation’s resources.

“But the airports are worse culprits. By my own calculations, the country spend more than N2 trillion annually to maintain the inefficiency.

“Let’s even agree just for the sake of this discussion that 32 airports get N187.5 million each month as operational costs, that amounts to over N1trillion annually.

“Are you telling me that Lagos, Abuja, Owerri, Port Harcourt, Calabar or Kano will operate only on less than N190million annually monthly?

“The amount won’t even pay the salaries and allowances of 15 directors in one airport, not to talk of their entire wage bill.

“Some people may argue that there is no provision of that amount in the budgets, but what of the income generated by these airports? Most of it are not remitted into the federation account.

“So, if you add what we are pumping into the airports and what the airports are generating as IGR but keeping to themselves, you will see that what we are losing is in the range of N2trillion, if not more.

“The country is bleeding heavily. And I can say with boldness that this is what happens in other sectors. Nigeria cannot move forward if we don’t stop the hemorrhage”, Engr. Ogundipe argued.

While stakeholders are asking for the scraping of most of these underutilized airports, the Federal Government under the leadership of former President Muhammadu Buhari, it was gathered at the weekend, had planned to take over more airports built by state governments.

The immediate past Minister of Aviation, Hadi Sirika, had in April 2023 told the House Committee on Aviation that more state governments had expressed readiness to transfer ownership of state-built airports like Kebbi, Dutse, Anambra, Ekiti and Gombe to the Federal Government, describing it as a sign of aviation growth.

However, several sources in the Ministry of Aviation informed BH that the new administration is against the planned transfer of states airports to it.

According to the sources, the current administration plans to hand over the airports to the private sector under a concession arrangement.

“We are in this mess because of past administrations from the North. Just because they wanted to give jobs to their people up North, they were just snapping up unviable airports running at a loss.

“The body language of the new president did not suggest that he will go that route. In fact, I can tell you that we have been given revenue targets to meet”, one of the sources claimed.

The immediate past Managing Director of FAAN, Captain Rabiu Yadudu, had in an interview he granted BH in May 2023, said almost all the state-owned airports are not sustainable, stressing that the agency would need the support of the Federal Government to handle them.

“There is no magic that can make an airport that needs N300 million a month but only 1,000 passengers a month sustainable.

“FAAN does not have the money. I think in the national interest, let’s come up with a plan for the Federal Government to make sure that if you build it and it is not workable now, one day, it will be sustainable”, the former FAAN MD had argued.

However, aviation stakeholders disagree with him. According to Comrade Olayinka, Abioye, the former General Secretary of the Nigerian Union of Air Transport Employees (NUATE), state governments’ rush for construction of additional airports is fraudulent and an aberration.

The former NUATE leader maintained that state governors should rather concentrate on building good road networks and train services for the transportation of commuters and goods.

“Most of the state governors did not carry out adequate feasibility studies before embarking on the airport projects that are now lying fallow”, he said