By Dickson Omobola
Mrs Olubunmi Kuku is the Managing Director of the Federal Airports Authority of Nigeria, FAAN.
In this
interview, Kuku speaks on plans to turn the country’s international airports into a hub, reasons the introduction of cashless policy caused chaos for travellers and other airport users and the 22 to 24 months timeframe given for the renovation of the Old Terminal at Murtala Muhammed International Airport, MMIA.
Excerpts:
The introduction of the cashless policy caused chaos for travellers and other airport users in Lagos and Abuja, leading President Bola Tinubu to call for a seamless system. What payment method is currently being adopted by FAAN?
Yes, it was quite a hectic period for us as well as for some of our passengers and commuters around the airport areas. I am sure you are aware that we actually introduced a cashless policy around July last year, and we intensified it in October. This year, we have seen quite a number of policy directives from the Federal Government asking us to stop cash activities. There were actually two circulars released by the Federal Government on this initiative.
Now, if you look closely at our airport environment, I think Lagos and Abuja are our two biggest markets, followed by Kano and Port Harcourt. Lagos and Abuja are quite interesting. In Abuja, most of the passengers going towards the airport area are using the airport as their end destination. There is a small community to the right, but I wouldn’t say that all of them are mobile. That is a big contrast to Lagos.
In Lagos, if you look at the positioning of the Lagos toll gate, it is actually to the right of the international airport where you have commuters who are either transitioning from the international to the domestic terminal, or you have people who are going to other parts of Lagos such as Ikeja, Oshodi and Isolo. Unlike most of the other airports around the world where they have a 13-kilometre radius, the Lagos airport is actually positioned within communities.
Of course, in the implementation of the cashless policy, it made it quite hectic because a lot of the commuters and even some of the passengers, despite a lot of awareness, did not believe that we would actually start the enforcement on March 1. It did create a huge bottleneck over the first few days, but we saw that it actually started to ease up.
We had registered about 100,000 customers, of which 62,000 were actually done in the last three days of the policy. In Abuja, for example, we saw the traffic start to ease up.
But despite that, our ultimate goal, outside of safety and security, is also to make sure that our passengers and the neighbouring areas have a seamless experience. We are grateful to Mr President, who was able to step in. For him, it wasn’t just about implementing a Federal Government directive. He understood the uniqueness of the airport environment and realised that if we implemented the policy without looking at the broader picture, including some of the infrastructure challenges that the airport has, such as potentially widening the lanes and improving or increasing the number of payment channels that we had, we would continue to have a challenge.
And in his rightful mind, within the Federal Executive Council, we did get a waiver that allowed us to operate a hybrid system, meaning that we will continue to use some of the contactless cards that we have put out, but we can also use cash until we get a broader view in terms of the number of people who can actually use contactless payments.
Hub
If you look at the Cairo International Airport and then look at the O.R. Tambo International Airport in Johannesburg, they have done something that works extremely well. What works extremely well for them is the fact that they have not just made their airports a destination for passengers who are coming into their country, but they have made them a hub.
What does that mean? Because a lot of people use the terminology “hub” very loosely. A hub is literally an environment or an airport environment where you are able to have transit passengers move from one location to another without necessarily making that country their end destination.
In Nigeria, for example, when you look at the key factors that drive passenger traffic, the biggest is the Gross Domestic Product, GDP. When you look at the GDP of the Nigerian population and compare it to our passenger traffic, it is actually very low, less than two per cent. What that means is that a lot of Nigerian passengers are not travelling, in contrast to many other regions. For us to be able to drive passenger traffic effectively, it means that we need to do a couple of things.
One, we need to either improve the business environment where there is a lot of trade activity happening that brings people into the country, or even increase economic activity, whether it is tourism or business activity. But when we start to look at the hub concept, we really see the future in two things.
One is in driving the hub strategy, and the second is also in both passenger and cargo movement. To make the hub strategy effective, a couple of things need to happen. It is not just about developing an airport or building infrastructure. It really requires that we look at the enablers. And what are these enablers? For example, look at the airlines. For us to be able to increase our aircraft movements and have additional points of entry, we look at the bilateral air service agreements that we have with other countries.
I believe that in this administration over the last three years, the Minister has actually improved the number of routes in terms of airlines going outside the country and also being able to come into the Nigerian market. But what that also means is that as we start to say we are driving a hub, we need to make sure that there is a transit area. Today, within Nigerian airports, it is quite difficult for you to transit because there is no transit facility. And this is actually one of the things that we are addressing as part of the rehabilitation work that is happening.
With the fire incident that happened recently, does it set back the timeframe for the renovation of the Old Terminal at MMIA?
Yes, we did have a fire incident that happened a few days ago. It did have a bit of an impact, but I would say that it was minimal. The impact was really on some of our technology that we were moving. But the good news is that we were actually planning on leaving that terminal. Wednesday of that week was the last day for us to leave the terminal. It is just about a two-day setback. We had manual operations and manual checking for about four or five days. We have now been able to restore our operations back to normal.
Now, in terms of the rehabilitation itself, yes, the 22 to 24 months timeline still stands. As of November, if you are passing through the airport area, we have now activated the temporary terminal. There are four airlines that have moved into that terminal: Middle East Airlines, Air France, KLM and Ethiopian, I believe, have moved in there. This is a temporary facility that was built within a three-month period.
We do have alternate routes that have also been built into the temporary terminal. If you notice, there is a bridge that has been built because part of the rehabilitation works also involves the entry and egress from the airport as well. We are, of course, working with the 22 to 24 months timeline.
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