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12 Jun, 2025
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Substituting Monopoly for Efficiency: Case Study of Nigerian Aviation Industry
@Source: thisdaylive.com
Dipo Kehinde This year marks a century since aviation took flight in Nigeria. From the first recorded aircraft landing in Kano in 1925 to today’s bustling network of domestic and international airports, the sector has evolved—though not without setbacks—from state-led control to growing private participation. As we reflect on 100 years of flight, one truth has become increasingly clear: the government can not carry this sector alone. Speaking at the launch of 100 Years of Aviation in Nigeria, the Honourable Minister of Aviation and Aerospace Development, Festus Keyamo, SAN, reaffirmed the indispensable role of the private sector in ensuring the industry’s long-term sustainability. Nigeria, he noted, remains one of the few African countries with a significant number of privately operated airlines—an arrangement that has brought a measure of stability and resilience to airline operations, even in turbulent times. On the subject of infrastructure, the minister cited the proposed remodelling of the Murtala Muhammed International Airport as another reason why Public-Private Partnerships (PPPs) are no longer optional—they are essential. Echoing this, the Managing Director of the Federal Airports Authority of Nigeria (FAAN), Mrs. Olubunmi Kuku has consistently called for deeper private-sector participation, not just for financing but for injecting technical and operational expertise. The message is clear: if Nigeria hopes to sustain and modernise its aviation infrastructure, it must embrace models that reward innovation, ensure efficiency, and inspire investor confidence. In this regard, the story of Murtala Muhammed Airport Terminal Two (MMA2), operated by Bi-Courtney Aviation Services Limited (BASL), is more than a model—it is a blueprint. Conceived through a concession agreement with the Federal Government, MMA2 has redefined what is possible when private-sector expertise is paired with public-sector ambition. However, recent commentary—particularly the article by Ebun-Olu Adegboruwa, SAN, in the Nigerian Tribune of June 3, 2025—suggests that fully enforcing this concession, especially the ceding of the General Aviation Terminal (GAT) to Bi-Courtney, would create a dangerous monopoly. While the article was articulate and rich in detail, the argument misrepresents both the intent and mechanics of the agreement. Enforcing a duly signed concession is not about gifting market control to a single entity; it is about respecting contractual obligations, preserving investor trust, and institutionalizing the principles of PPPs that are already transforming the aviation sector. A monopoly, by definition, implies exclusive, unchecked dominance over a market—often leading to poor service, high prices, and a lack of innovation. MMA2, however, operates within a strictly regulated environment. Core aviation functions such as airside security, runway management, and landing charges remain firmly under FAAN’s jurisdiction. The concession doesn’t eliminate competition; it elevates the playing field. It has set a performance standard that others now strive to meet. Indeed, prior to MMA2, all Nigerian airports were operated by FAAN. Innovation was sluggish, and service levels remained static. The introduction of a private operator challenged that status quo. Far from stifling competition, MMA2 catalyzed it—demonstrating how infrastructure, service, and customer experience can all be dramatically improved under private management. Some of MMA2’s pioneering achievements include: .First Domestic Terminal with Automated E-Gates: Enhancing passenger flow and security. .Deployment of Boarding Bridges: Previously absent in domestic travel. .Implementation of Common User Passenger Processing Systems (CUPPS): Now emulated by public terminals. .Construction of Nigeria’s First Multistorey Car Park: A model for space efficiency and user convenience. .Development of a Modern Cargo Facility: Strengthening logistics and revenue diversification. .Consistent Aesthetic and Lounge Enhancements: Elevating the travel experience across all classes. One of its most transformative features is its mall-style layout—a retail, dining, and leisure space that rivals international standards. These are not monopolistic feats. They are competitive ones—clear evidence of what’s possible when private enterprise is incentivized to excel. Globally, Nigeria is not alone in this shift. The United Kingdom offers a clear example: Gatwick Airport, one of London’s busiest, is privately owned and operated, existing alongside Heathrow and Stansted without invoking fears of monopolies. Heathrow’s Terminal 5, developed by British Airways in partnership with the British Airport Authority, is another example of private-sector driven excellence. In India, the PPP model in aviation—led by groups like GMR at Delhi and Hyderabad airports—has revolutionized air travel, improved infrastructure, and created globally ranked terminals, without monopolistic fallout. But perhaps the most telling cautionary tale—and one Nigeria cannot afford to repeat—is the exit of Sir Richard Branson’s Virgin Nigeria. When Virgin Group partnered with Nigerian stakeholders to create what was then a promising national carrier, it entered the country with high hopes and global best practices. However, regulatory inconsistencies and persistent breaches of the partnership agreement eroded trust. Branson would later describe the experience as one of “betrayal and broken promises,” citing interference and an unwillingness by the Nigerian government to honour its commitments as key reasons Virgin pulled out. The fallout not only ended an ambitious project but also sent a chilling message to global investors: that contracts in Nigeria may not always be worth the paper they’re printed on. That episode remains a painful reminder of what’s at stake when agreements are ignored and investor confidence is undermined. By contrast, enforcing the Bi-Courtney concession sends the opposite—and correct—signal: that Nigeria is ready to uphold the rule of law, reward good faith investment, and anchor future partnerships on trust and transparency. As Nigeria enters its second century of aviation, the question is no longer whether the private sector should be involved. That debate is settled. The focus must now be on how to foster investor confidence, ensure consistent policy direction, and scale models that work. Upholding the MMA2 concession agreement is not just a legal necessity—it is a strategic imperative. It signals that Nigeria is a country that respects contracts, welcomes innovation, and honours partnerships. Bi-Courtney’s story is not one of market control. It is one of market transformation—and the future of aviation in Nigeria depends on recognizing and replicating such success.
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