Economist Supports Arik GAT Concession Action

As Arik Air management is currently contending against the directive of the Minister of Aviation, Mr Babatunde Omotoba, seeking the relocation of all airlines operating in General Aviation Terminal (GAT) to Murtala Mohammed Airport terminal two (MMA2), operated by Bi-Courtney through Public Private Partnership (P3) agreement with the Federal Government, an economist, has thrown his support on Arik action, saying it was in the best interest of the economy, and capable of preventing new investments.

Speaking to newsmen in Eket during the opening of Akwa-Ibom Airport, Mr Udoh, who is also the Chief Coordinator, Institute of Chartered Economists of Nigeria (ICEN) South-South expressed displeasure on the manner government contracts states’ owned assets to private companies without factoring economic constrains and lack of concern and regards to due process.

Udoh, who described Public Private Partnership (PPP) as a Special Purpose Vehicle (SPV), that is widely accepted in meeting financial shortfall of government to meet with the infrastructure deficit in any economy, said it is also a platform to which concession agreement is implemented.

“Public Private Partnership represents a contractual agreement formed between a private enterprise to renovate, construct, operate, maintain and manage a facility or system, the private party is given additional decision rights in determining how the project or task will be completed, while the government watch against the abuse of the infrastructure by private enterprise, against its citizens through legislations” he said.

According to him, the General Aviation Terminal (GAT) MM2 and Lagos Ibadan Expressway under Bi-Courtney, is amounting to captivity, while describing these actions as economic mistake that need to be corrected.

He noted that these infrastructures exhibit natural monopoly, and characterised them as non-perfect public goods. To him,  perfect public goods exhibit non rival’s consumption thus capturing ‘River Dyke’ protecting all property owners.  But to where a property owner does not have the dyke it means that all will be flooded.  Likewise, the dyke is a public good at the same time exhibiting non perfect characteristics, and if it is privately funded, property owners can have a ride on the construction cost, thus deserving participation of private enterprise, yet in a more efficient manner.

He noted that the decision to annex General Aviation Terminal, Ikeja, to this same organisation is evil to which civilised world including United States of America through (Federal Antitrust Laws) the Sherman Antitrust Act 1890 and the Clayton Act 1914 is fighting to free the captive consumers from the grip of profit conscious private enterprises.