Chairman of the Nigerian Aviation Handling Company Plc (also called nahco aviance) Mallam Suleiman Yahyah, OON, tells Eyeway some little known drivers of economic growth
For the past 10 years, you’ve been advocating reforms in the aviation industry. Have you seen any reform yet?
A former minister, Stella Oduah, started it. At least she did aviation master plan and initiated the current modernisation of airports, before she was enmeshed in a controversy. There’s also the BPE reform which road-map should lead to the privatisation of FAAN.
Have you seen the aviation master plan?
Yes. We were part of the conversation on the master plan.
What reforms do our airports need?
Three reforms are imminent. First, institutional and regulatory reforms of key agencies especially the Federal Airports Authority of Nigeria, FAAN. The current airport management model should be optimised. Government should consider concession and privatization as was the case at the seaports. Second, the soft infrastructure: training, processes and best practices. Third, the physical infrastructure to ameliorate the decayed infrastructure: new runways for Lagos and Abuja.
The aviation sector needs a lot of reforms. The airport infrastructure in use today was designed in the 1970s. It was designed to handle 3million passengers per annum. Today, there is over-capacity as the nation’s airports handle 17million passengers per annum. By now, we ought to have expanded our airports at least by four times. There is infrastructure decay: the mega terminals in Abuja, Lagos, Port Harcourt and Kano need supporting infrastructure to enable hubbing and at least two aerotropolis.
Aerotropolis is a city within an airport. It has shopping malls, hotels, meeting halls, conference rooms, residential apartments, etc. Those people you see at Heathrow work and live around the airport. You can have 1million people working in our airports. If Atlanta, Dubai and others are handling 50 to 65million passengers, and Nigeria is handling 17million, it means the potential for improvement can be optimised. The United States has nine hubs; the UK has four. Nigeria should have two.
Won’t lack of power supply be an impediment to having an aerotropolis here?
Nothing stops us from dedicating an independent power plant to the airport. It’s a whole sub-economy that can generate 10% of our GDP. It can employ 2million Nigerians within four years and contribute up to $100billion wealth to the economy in a trigger.
Aviation is not the only sector that needs attention. Why do you consider it too important?
Aviation is one of the greatest providers of jobs globally and a major contributor to GDP indirectly as it facilitates trade, culture and investment. Global investors will not drive or cruise to a corner of Nigeria; they will fly in and out. The service sector is a key winner for job creation because it absorbs skilled, semi-skilled and unskilled manpower. As can be seen in Dubai, Mumbai, Shanghai and the likes of Atlanta, Heathrow, aviation is a driver of economic growth. Transportation and logistics are the largest employers of labour. One aircraft’s landing creates thousands of jobs. Of Dubai’s 4million population, over 30% work in the logistics sector.
Lagos or Abuja is not Dubai. Or, doesn’t Nigeria have peculiar disadvantages?
Nigeria is at the centre of the world – the arc of opportunity. It is one hour ahead of Greenwich Mean Time (GMT) and 45 degrees above the Equator. No country in the world has this unique geostrategic advantage with our demographic dynamics. From Nigeria you can fly and connect each of the five continents of the world within an average of 7 hours. Again, the major population centres are, with the exception of Nigeria, located far from the Equator. Then you have the Gulf of Guinea hydrocarbons and the huge shipping lane. We have a natural traffic-originating capacity. Assuming, for instance, that we decide to subsidise aviation fuel, major aviation operators would all fly to Nigeria to refuel. Thus, Nigeria can become a hub. Dubai is a hub because everyone goes to Dubai to purchase one thing or the other or to connect to somewhere.
Services are important to an economy, but so is manufacturing.
It’s too late for Nigeria to become a manufacturing giant. We call it the “latecomer disadvantage”. It’s too late to copy and catch up with technological innovation. Nigeria’s competitive advantage has shifted to services. We need a new culture, the Nigerian mentality to reinforce it as a global brand.
You seem to be optimistic about business in this country. Why?
Business is about efficiency. Leadership is about strategic repositioning and an arena for action. President Buhari should seize the opportunity created by the “tide” he spoke about in his inaugural speech. I envision a strategy that will unlock the aviation opportunity for the benefit of Africans. We are optimistic that the CHANGE leadership we have now will be pro-business. This should ginger business leaders to drive new capital formation for Lagos and Abuja aerotropolis.
What do you think will be the fate of private jets that many Nigerians have bought?
It will be laissez-faire, market forces, that will determine their fate. They will soon begin to time-share the ownership. Most of the jets are supporting conspicuous consumption and the arrival of the nouveau riche.
Editor’s note: This exclusive interview with Mallam Yahyah is in the print version of Eyeway dated July 5-18, 2015, now on sale.