Aviation Ministry’s N1bn China Loan Sparks Mixed Reactions

Aviation Ministry’s N1bn China Loan Sparks Mixed Reactions

·  Ministry to provide expenditure details this week – Spokesperson

·  APFFLON demands clarity on perceived slush fund

·  How Nigerian airports can attain hub status in Africa – CILT

By Kenneth Jukpor

Following the Minister of Aviation, Senator Hadi Sirika’s revelation that the Ministry has expended N1billion borrowed from China on airport repairs, aviation stakeholders have shared varying views on the loan amid plans to concession the airports.

Speaking at a webinar organised by the Nigerian Economic Summit Group on Thursday in the penultimate week, Sirika said “Currently, we borrowed about N1billion from the Chinese to put into our four airports. If we were to have made the decision at the time, we would not have borrowed money to put into the airport. We would have ‘concessioned’ the airports and used other peoples’ money to achieve what we want and get a better deal in the end.”

This statement has left aviation stakeholders perplexed as the industry had been oblivious of the Chinese loan collected to maintain the international airports in the country.

Although the Minister posited that the money was collected before the idea to concession the airports was conceived, some stakeholders believe that the loan venture is a slush fund in the Ministry as they have demanded a breakdown of the repairs at the airports.

The N1billion sum quoted by the Aviation Minister is also being labeled an understatement as the air travel sector has carried out major infrastructure rehabilitation which include the Nnamdi Azikiwe Airport runway repairs which cost N5.8billion in 2017 and the rehabilitation of the runway at the Akanu Ibiam International Airport, Enugu which cost N8.5billion earlier this year.

Speaking with MMS Plus on this development, the President of Africa Association of Professional Freight Forwarders and Logistics of Nigeria (APFFLON) Mr. Frank Ogunojemite admonished the Ministry to furnish the public with details of the Chinese loan and how the money was spent.

“This is a really strange development because no one was aware the Ministry procured loans to manage the international airports. We demand clarity on this loan because the money is huge and taxpayers’ money would be used to repay the loan,” he said.

Meanwhile, the APFFLON boss also stressed that Nigerian airports have been allocated colossal sums in the $3.1billion Customs Modernization Project, a concession arrangement awarded to Messrs E-Customs HC Project Limited.

“What prompted the Chinese loan obtained by the Aviation Ministry given plans for concession and the funding to be provided by the concessionaires of the Customs Modernization Project? When was this loan procured? Which airports benefitted and what was it used for?” Ogunojemite queried.

Meanwhile, the Director of Public Relations, Ministry of Aviation, Mr. James Odaudu assured our correspondent that the Ministry would provide the details of the expenditure on the Chinese loan this week.

“At this moment, I wouldn’t be able to give details of the loan such as when it was collected and the specific purposes for which it was utilized. However, I can avail you these details next week,” Odaudu told MMS Plus on Friday, last week.

However, the President of Chartered Institute of Logistics and Tranport (CILT) Nigeria, Mr. Ibrahim Jibril argued that there is nothing wrong with the fact that the money was borrowed to fix the airports for Nigeria, stressing that it happened before the idea of concession came onboard.

He, however, stated that CILT supports the move to concession the international airports because Nigerian airports will be better managed when they are in private hands.

His words: “Private sector will guarantee more investment, infrastructural development and efficiency at the airports. However, I would advise that the concession arrangement should be for the benefit of Nigerians. We shouldn’t enter into an agreement that would shortchange Nigeria. We should look at the agreement carefully and scrutinize it word for word so that at the end Nigeria would get value for money.”

“Concession usually creates a win-win situation for all parties, but a situation where one party benefits more than the other would lead to problems. A good concession arrangement could see Nigerian airports come up to the standard that would be comparable to other top airports across the globe.”

According to him, Nigeria has lost the hub status in air travel in Africa, but a good concession framework could see Nigeria develop her airports and infrastructure to become the hub and ferry passengers across the sub-region.

Noting the resentment of aviation unions towards the concession arrangement, he stressed that there was a need for robust engagement and public hearing on the concession framework before it was implemented.

“All stakeholders must be involved in the engagement prior to the airport concessioning. It shouldn’t be hurried to the extent that stakeholders aren’t allowed to make contributions. It shouldn’t be a closed door agreement that people wouldn’t be privy to, especially crucial stakeholders. If it is opened up and discussed at national level to allow everyone to make input, Nigeria will have a worthwhile concession arrangement.”

“The trade unions are skeptical because they have seen how concession agreement can be crafted in such a way that the nation benefits nothing. Based on that fear, they have every right to express their resentment. However, it doesn’t mean that if everyone isn’t onboard we wouldn’t get the best arrangement that would profit the industry,” he added.

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