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Why Nigerian Airports Generate Low Non-Aeronautical Revenue

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Published in Finance
Friday, 05 June 2015 00:00

The reluctance by the federal government to cede airport management to private concerns and its lack of innovative have been attributed to reasons why many airports in Nigeria do not generate high non-aeronautical revenues.

Non-aeronautical revenues are such revenues that accrue from non-airline services such as parking and landing charges, fuel surcharge, baggage taxes and others that relate to passengers but include revenues generated from businesses around the airport, advertising, meeters and greeters and others.

 In Europe, Americas and in the Gulf regions, non-aeronautical revenue has risen to 70 per cent of the total revenues generated by airports but in Africa, besides South Africa, non-aeronautical revenues are still below 50 per cent of the total revenues generated by airport services and in Nigeria it is below 30 per cent.

The CEO of Bi-Courtney Aviation Services Limited (BASL), which built and is managing the Lagos airport domestic terminal (MMA2), Christophe Penninck explained to THISDAY in an interview that modern airports are seen as economic development centres so it is built and created to attract businesses in addition to providing the critical service of passenger facilitation and air travel.

 "The purpose of an airport all over the world is changing. It is not only to take one person from point A to point B but it is economic development centre. Look at Johannesburg, it has wonderful airport. Do you know many shops it has? I was there when it moved from being a small terminal to what it is now. I was there when they were transforming it. It was difficult to operate but now they have tripled the shops inside it."

"It is a whole new experience; people enjoy travelling through Johannesburg airport because you have things to do. You don't necessarily waste your time sitting down, you can spend your time either shopping, enjoying a massage, ice cream. So the non-aeronautical in the new airport is almost more important than the aeronautical revenue. The aeronautical revenue should be for investment in security, in safety and the maintenance of all the equipment to make sure that an aircraft can land in any weather condition," Pinninck added.

 On infrastructural limitations at the Murtala Muhammed International Airport, Penninck said there should be a way to transfer passengers from domestic to international terminal and vice versa.

"We should device the means to have a link between the terminals here (domestic) and international. Whatever means you may choose, whether monorail, rail or otherwise but we should have a shuttle between both terminals to create the hub system in Nigeria. What we have now is that first of all you go through the hassles at the international terminal, you are endlessly in traffic and by the time you end here you might have even missed your flight.

"So we must change that. It is a big project but it is something that has to be done at government level. It is an investment the same way that Lagos State has invested or is investing now in this mono rail, the same thing should be done here at international airport. Make it a seamless connection between international airport and domestic," Penninck added.

 He also remarked that to improve safety, government should ensure there are efficient landing equipment at all the airports, including airfield lighting, which will enable airlines to fly to any airport at any time.

"The Murtala Muhammed International Airport must be well equipped enough to handle domestic and international flights on both runways and in all weather conditions. And the same thing should be done in Abuja. Abuja really should have second runway and then Port Harcourt should also have a descent terminal and better landing equipment. What the previous minister has done is good, that is starting the modernising of equipment at all the airports. It is a good step but on this particular airport, it is better connection between domestic and international and better landing equipment," the BASL CEO said.


Source: This Day

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Online Editor at Interarchtiv Media Company

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