FAAN boss opposes creation of aviation finance institution

Managing Director and Chief Executive Officer of the Federal Airports Authority of Nigeria, Mrs. Olubunmi Kuku, has rejected proposals for a dedicated aviation financing body, urging instead that existing lenders create specialised aviation desks to deepen sector understanding and support.

Speaking at the recent African Air Transport Convention and Expo 2026 in Togo on the role of effective PPP models in infrastructure development, the FAAN chief argued that establishing new institutions is unnecessary and could further complicate efforts to raise funding for critical projects.

According to her, the focus should be on strengthening existing financial structures and equipping them with the technical expertise required to assess aviation investments.

While reacting to suggestions for new aviation-focused financing institutions, Kuku noted, “I strongly do not support that, I’d rather that the existing financing institutions set up specialised desks to understand the aviation environment and also provide support, if possible, as part of project preparation facilities.”

The FAAN boss explained that many financiers, including development finance institutions, are often confronted with a shortage of well-prepared and bankable aviation projects rather than a lack of available funds, stressing that technical support for project preparation would help stakeholders present viable investment opportunities capable of attracting financing.

“Because what that does is it gives them a better understanding of presenting bankable projects as well, so that they’re working side by side,” she said.

She further noted that stronger collaboration between financiers and aviation stakeholders would unlock much-needed infrastructure investments.

Drawing from her experience in both infrastructure finance and airport management, Kuku noted that successful Public-Private Partnership models are not driven solely by access to capital but by institutional credibility, regulatory certainty and disciplined project execution.

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“It’s not just driven by capital availability, but really around resilience on institutional credibility, regulatory certainty and project discipline,” she said. “A lot of the challenges that we have seen are really around project continuity and market risks.”

She cited the long-running concession dispute involving the Murtala Muhammed Airport Terminal Two, operated by Bi-Courtney Aviation Services Limited, as an example of how unresolved contractual issues can undermine investor confidence. However, she disclosed that the matter had now been resolved at the Federal Executive Council level.

She said, “It’s now been resolved. What that means is that it provides better investor confidence for those looking to drive PPP projects and ensures that future concession agreements are fair to both government and the private sector.”

Kuku also mentioned that FAAN currently manages 22 Federal Government-owned airports and is implementing a roadmap designed to modernise infrastructure while improving passenger experience.

She hinted that the authority was focusing on digital transformation, including the deployment of e-gates, biometric processing systems and RFID technology for baggage handling.

According to her, Nigeria’s aviation market still holds significant growth potential, with the country’s annual passenger traffic of about 17 million representing less than 10 per cent of its estimated population of over 220 million people. She identified transit passengers and cargo operations as major areas for future expansion.

The FAAN chief said further, “We believe strongly that transit passengers as well as cargo present huge opportunities.”