FG to generate $800m revenue from concession of Abuja, Kano airports, says Sirika

From Abubakar Yunusa Abuja

Hadi Sirika, the minister of aviation, says the federal government will generate about $800 million from the concessioning of two international airports.
The federal executive council (FEC) approved the concessioning of the Nnamdi Azikiwe International Airport (NAIA), Abuja, and the Mallam Aminu Kano International Airport, Kano.
Speaking to journalists after the FEC meeting, Sirika said the Abuja airport would be concessioned for 20 years, while the international airport in Kano will be concessioned for 30 years by Corporación America Airports.
Sirika also said the approval was part of the ministry’s roadmap aimed at putting the nation’s assets under concession rather than privatisation.
According to the minister, the concession would generate $797.4 million (N368.8 billion) as fees and taxes from the concessionaire.
“Put together, it is about $800 million. And this is equal to the amount of money that we borrowed to build those four airports,” Sirika said.
“The consortium that won the bid is Mssr Corporación America Airports consortium and in the consortium, they have Mssr Mota-Engil Africa and Mssr Mota-Engil Nigeria and this is through a PPP, and it’s for 20 years for Abuja, and 30 years for Kano.”
Speaking further on revenue expected from the deal, Sirika gave a breakdown of the amounts payable to the government as fees and taxes.
“The concession fees or upfront fees for Abuja is $7 million while $1.5 million will be given for Kano. The fixed concession fee is $401.2 million for Abuja and fixed fees for Kano is $21 million,” he said.
“The variable costs concession fee is $154 million for Abuja, and $26.9 million for Kano. Tax $111.2 million for Abuja and $42.7 million for Kano. The Infrastructure Concession Regulatory Commission (ICRC) supervision fees for Abuja is $16.4 million and $5.3 million for Kano.
“So, the total amount of money that is accruing to the government is $700 million for Abuja and then $97.4 million for Kano.”
The aviation minister also said the aforementioned fees are different from the direct fees the Federal Airports Authority of Nigeria (FAAN) would continue to earn from passenger service charges, which is projected to be $4 billion (N1.84 trillion).