adminis ongoing at the Harare International Airport and the JM Nkomo Airport in Bulawayo, however, with the State facing serious fiscal constraints, offshore financing is one of the available alternatives.
To this extent, one of the Government’s main options in this respect is long-term concession for these rehabilitation projects.
Long-term concessions for airports are the predominant model today, with governments often taking a minority shareholding in the ventures.
Finance Minister Tendai Biti, in the 2012 Budget, granted limited funding to the airport infrastructure rehabilitation project on the basis that external financiers would meet some of the funding requirements.
“Budget capacity to meet the requirements of upgrading our airports infrastructure is also limited, hence efforts are underway to attract the participation of potential investors.
“With regards to ongoing works at Harare and Bulawayo airports, I propose a Budget provision of US$17,5 million as follows: Harare Airport runway rehabilitation (US$7 million) and JM Nkomo Airport (US$10,5 million),” he said.
These indications by Government to engage foreign investors emerge without the determination of a master plan for the civil aviation sector.
A master plan would certainly give potential investors confidence, especially in view of the challenges that the country’s aviation industry has been facing of late.
The African Development Bank earlier this year proposed such a master plan that was structured on seven key elements:
- Completion of the substantial rehabilitation and upgrade of aviation infrastructure at the airports controlled by the Civil Aviation Authority of Zimbabwe.
- Improvement of airspace management and airport operations, especially with regard to safety and security;
- Liberalisation of the air transport market and deciding on what to do with the national flag carrier, Air Zimbabwe;
- Implementation of institutional reforms that would separate the regulatory functions of CAAZ from its commercial interest in airport operations;
- Development and maintenance of the requisite skills for the civil aviation industry; and
- Launching of a privatisation programme to attract much needed private sector funding for rehabilitation and upgrade of airport facilities to accommodate the projected growth in passenger and freight movements. (AfDB’s Zimbabwe Infrastructure Report 2011). According to the regional financier, one of the key objectives of such an action plan is for the CAAZ to meet the minimum requirements of the International Civil Aviation Organisation by 2013.
It is unlikely that without meeting such requirements, the country’s airport infrastructure can attract significant levels of foreign investment because long-term concessions can be complex.
The Government should therefore be clear about its policy objectives and structure the contracts accordingly.
The AfDB has estimated Zimbabwe’s airport infrastructure rehabilitation to cost around US$300 million, which at present can neither be met through the National Budget or from CAAZ’s operations.
The setting up of a civil aviation master plan can then lead into the development of a business plan designed to attract potential private investors in the management, financing and development of airport infrastructure.
Peter Tanyanyiwa
Online Reporter