0. TANZANIA AIRPORTS AUTHORITY
TAKING CIVIL AVIATION INDUSTRY IN TANZANIA TO THE APEX
1st National Civil Aviation Forum, 2017
Financing Options for Airport
Infrastructure Development
Salim R. Msangi
DG TAA

1. BACKGROUND
Air transport is a crucial development driver bringing both economic development and social benefits, including regional integration.
It has major rippling effects on job creation as well as trade and tourism etc.

2. BACKGROUND…….…… Financing Airports Development
Throughout the World, Airports are being developed and upgraded to become airport cities with modern and sophisticated facilities.
Various sources of funds:
Airport surplus (retained earnings)
Government grants-in-aid
Borrowed funds
Third-party development
Private Sector Participation

3. BACKGROUND………… Global Trend of Airport Competition
World and Regional air transport is growing.
Competition between Airport Operators is getting stiff.
In East & South African Region, countries are competing in provision of quality services and facilities to aviation customers (e.g Nairobi, Kigali, Addis, JNB, Zambia).

4. Source: (ACI: World Airport Traffic Database, 2016)
BACKGROUND…………
Global Passengers traffic grew by 6.4% in 2015 reaching 7.2 billion.
Africa Region Passengers traffic grew by 0.6% in 2015 reaching million.
Tanzania Passengers traffic declined by 1.1% in 2015 reaching 5.2 million.
JNB(4.8%), CAI(7.9%), CPT(8.8%), ADD(11.7%), LOS(-8.9%), NBO(1.5%), JNIA(0.7%).
Source: (ACI: World Airport Traffic Database, 2016)

5. BACKGROUND…………
Likewise, Tanzania is not an island, we have been striving to develop our Airports infrastructure( slow pace) to be competitive in the region.

6. BACKGROUND…….
Given a mandate to Develop Airports Infrastructure including facilities.
To operate, manage and maintain.
Aiming to make the Aviation Industry competitive within the region and beyond.

7. BACKGROUND…….……
We have been working through our Vision and Mission.
To provide high quality airport services and facilities to become a world class airport operator.

8. Government Budget Loans Grants
2.0 EFFORTS MADE BY THE GOV
For the past 18 years, TAA through Government support has improved and developed Airports infrastructure and facilities through the following financing arrangement:
Government Budget
Loans
Grants

9. EFFORTS MADE……………….. Completed Projects:
1. JNIA: Rehabilitation and Upgrading of airside pavements and Facilities.
Financier: GOV & ORIO
2. Mpanda: Upgrading of airside pavements and Facilities
Financier: GOV & UNHCR
3. Arusha – Resurfacing of Runway, Taxiway & Apron.
Financier: GOV

10. 5. Kigoma: Upgrading of runway.
EFFORTS MADE………………..
4. Tabora: Upgrading of runways, taxiway and Apron.
Financier: GOV & WB
5. Kigoma: Upgrading of runway.

11. EFFORTS MADE………………..
6. Mafia: Upgrading of runway, taxiway and apron Financier: GOV & MCC 7.Bukoba:Upgrading of runway, taxiway, Apron and Construction of terminal building. Financier: GOV & WB

12. Ongoing Airports Projects
EFFORTS MADE………..
Ongoing Airports Projects
1. Construction of Songwe Airport
Financier: GOV, BADEA & OFID
2. Mwanza Airport
3. Construction of TB III at JNIA
Financier: GOV
4. Upgrading of KIA:
Financier: GOV& ORIO

13. Upcoming Airports Projects
EFFORTS MADE………………..
Upcoming Airports Projects
1. Upgrading of Shinyanga Airport
Financier: GOV& EIB
2. Upgrading of Sumbawanga Airport
3. Construction of TB at Tabora Airport

14. Projects in Appraisal Stage
EFFORTS MADE………………..
Projects in Appraisal Stage
Completed FS and DED:
Arusha
Msalato
Mtwara
Tanga, Iringa, Kilwa-Masoko, Lake Manyara, Moshi, Musoma, Lindi, Njombe, Songea, Singida, Bariadi (Simiyu region)
Financier: GOV & WB

15. 3.0 OUTCOME.
Efforts made in airport infrastructure development for the past 18 years have shown positive growth in terms of :
Aircraft Movements,
Passenger,
Cargo,
Revenue.

16. OUTCOME………
136%

17. OUTCOME…….

18. 4.0 FUTURE PLANS
Airports today have become an integral part of the global economy.
Not only moving passengers and Cargo from country to country and continent to continent but Airports cities.
Aviation contributes about $2.7 trillion of the Global GDP.(

19. FUTURE PLANS….
Continue Upgrading and Rehabilitating Airports Infrastructure.
Modernization of Airport facilities.
Enhancing Investments projects in non aeronautical Revenue.
Involvement of Private Sector

20. FUTURE PLANS…
Developing JNIA as main hub of Tanzania.
Support National Carrier as it increases its operations.
Develop feeder airports (Mwanza, Songwe, Kigoma, KIA, Mtwara) to support the main hub.

21. Government funding Grants and Loans PPP 5.0 FINANCING APPROACHES
Financing of airports infrastructure;
Government funding
Grants and Loans
PPP

22. FINANCING…… GOV funding is insufficient Gov budgets takes long time
As we All know:
GOV funding is insufficient
Gov budgets takes long time
TAA needs quick investments
Need to venture adversely in other financing structures such as involving Private Sector.

23. 6.0 FINANCING THROUGH PPP
The Government conducted a study on PPP appetite in the development of 11 Airports Infrastructure:

24. FINANCING THROUGH PPP…….
Findings from the study on PPP Involvement as individual transaction
High Attractiveness for PPP
JNIA and KIA
Low Attractiveness to PPP
Arusha, Mwanza, Lake Manyara, Kigoma, Mafia and Songwe
Not Attractive for PPP
Mtwara, Tabora and Msalato

25. FINANCING THROUGH PPP……
Another Approach suggested is to create groups-Mixing Most viable airports with the non viable .

26. Grouping by implementing BLOT PPP Model:
FINANCING THROUGH PPP……
Grouping by implementing BLOT PPP Model:
Group A: KIA, Mwanza, Lake Manyara and Songwe airports
Group B: JNIA, Arusha, Kigoma and Mafia airports
Group C: Mtwara, Tabora and Msalato airports

27. Involvement of Private sector is the way to go. TAA be Full Autonomous
7.0 CONCLUSION
Involvement of Private sector is the way to go.
TAA be Full Autonomous

28. Thank You For Listening