I started doing some work for a client, parsing their municipal bond holdings and trying to estimate their future cash flows and the probability of those flows materializing, basically some essential valuation assumptions. Because one of their more significant cash flows were Miami-Dade Aviation bonds, I was required over the past week to get very familiar with the financials of Miami International Airport.
No biggie. One search on Google brought up their Annual report for as far back as I could see. I had 2014,13, and 12 out on my desktop, pulled up Excel and went to town. Within a few days, I had insights into the operations of an Airport that I’ve used countless times and just never thought about.
It then got me wondering, how come the same openness and availability of information doesn’t apply in Nigeria. A number of attempts to find reports on revenues, concessions and financing systems for Murtala Muhammed Airport, Lagos came up with nothing. You do get information on number of passengers served in the past year, but that’s about it. Everything else, you probably have to dig and claw and maybe go through a wringer with our Ministry of Aviation and Freedom of Information process in order to get this. In a closed society like that, nothing gets improved because no one knows what is happening anywhere.
I know right now, that Miami International airport is managed through an independent enterprise fund that allows it to raise financing from municipal and bond investors, invest in its operations and infrastructure, maintenance and what have you, and then return any surpluses to the Miami-Dade county. The investments are open, planning is transparent, and financial reports are audited annually and published openly. The airport fund raised $6.5 billion from investors in 2002, which it used to expand its operations, with a target of ferrying about 40 million passengers by 2016 based on their growth rate then. They’ve spent $5.9 billion of that investment, and they surpassed 40 million passengers in 2014, yet service time is smoother now than it was when the traffic was much smaller because the airport has expanded along with its traffic.
Back in Nigeria, MMIA has lights and air conditioners that don’t work, terminals that can’t support the traffic flowing through them, worn out equipment and delays on a thousand, due to lack of maintenance, under investment and more. The story is the same across much of our aviation system, Port-Harcourt International recently had the distinction of being ranked the worst airport in the world. Yet successive aviation ministers have come and gone, with corruption scandals plenty. No one has decided to pass a law mandating annual audits, open reporting, and some kind of independence for the management of our airports.
It took Dr. Emmanuel I. Kachikwu taking over NNPC for us to get public reports of their operating and financial performance, which in just a few short months has made a tsunami of difference. Why don’t we borrow that leaf and make all parastatals do the same? It will help the people know how their resources are being used, help these parastatals obtain and manage their financing and budgets more easily, and improve all round performance, data management and planning for everyone. So why aren’t we doing that?