Does Nigeria's N712bn Lagos Airport upgrade scuttle the concession plan?

The Federal Government of Nigeria’s renewed push for airport concession is facing strong headwinds. The policy is designed to address massive airport infrastructure decay. However, a recent N712 billion (approximately $800 million) upgrade plan has raised serious questions.

Minister of Aviation and Aerospace Development, Festus Keyamo, announced the N712bn approval. The funds are for a complete overhaul of Murtala Muhammed International Airport (MMIA) Terminal 1 in Lagos. This project is intended to strip the 1979-era building down to its frame. It will then be rebuilt with new mechanical and electrical systems.

Conflicting Priorities and Cost Debate

This massive investment creates confusion among industry experts. MMIA is one of four major airports slated for concession. Experts question spending such a large sum on a facility soon to be handed over. Some analysts argue the N712bn is grossly inadequate for a truly modern, world-class airport. They suggest a facility for the future should cost at least $2 billion.

Others believe the funds could be better used for other urgent developmental needs. The government defends the move as necessary to meet global standards. They also cite the need to prevent foreign airlines from abandoning the route.

The Concession Status and Financial Viability

The four airports earmarked for concession are the most commercially viable. They are Lagos, Nnamdi Azikiwe International Airport (Abuja), Mallam Aminu Kano International Airport (Kano), and Port Harcourt International Airport (Omagwa). Data from the Federal Airports Authority of Nigeria (FAAN) shows these four generated 96.4% of the agency’s total N382.1 billion revenue in 2024. Lagos Airport alone accounted for 67% of this revenue.

Preferred bidders were previously named for three of the four airports. Corporación America Airports and Mota Engil Group were selected for Abuja and Kano. TAV/NAHCO/Project Planet Limited Consortium was the choice for Lagos.

Crucially, none of the preferred bidders have made the required financial commitment. This non-commitment casts doubt on the entire process.

Aviation Unions’ Legal Challenge

Aviation unions are a major source of resistance. The National Union of Air Transport Employees (NUATE) and others have secured legal services. They are challenging the concession process at the Federal High Court.

The unions insist on full implementation of extant labour laws. They demand that pension issues for FAAN staff be resolved before any concession. They fear a repeat of the unpleasant treatment meted out to former Nigeria Airways workers. They also oppose the “cherry-picking” of only the most profitable airports.

Global Trend and Call for Transparency

Industry leaders agree that private sector participation is the solution to infrastructure challenges. Globally, over 45% of passenger traffic passes through privately managed airports.

Experts stress that the execution and regulation must be transparent. They call for a clear model for each airport’s development. Without a strong regulatory framework, there is risk of unfair tariff hikes. Labour protection clauses are also essential to mitigate job displacement. The current administration has promised transparency and stakeholder engagement.

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