Wednesday, October 30, 2013

Come clean on Sh2.4bn cost of temporary JKIA terminal



  Tourists arrive at the Moi International Airport in Mombasa last year. FILE
Tourists arrive at the Moi International Airport in Mombasa last year. KAA has started the search for a new operator of duty-free shops. FILE 

In Summary
  • One question, however, that Kenyans will need answered is why it will cost them so much to acquire a temporary facility
After the mysterious fire at the Jomo Kenyatta International Airport, Kenyan taxpayers have been handed a massive bill of Sh2.34 billion.
This is what it will cost to build a temporary terminal at the country’s main airport to replace the one that was lost with the burning of the international arrivals station. It is a price that many Kenyans will find hard to comprehend.
An investigation concluded that the fire was accidental, exonerating airport officials from blame.
Kenyans can only hope that important lessons were learned about disaster preparedness, prevention and handling. One question, however, that Kenyans will need answered is why it will cost them so much to acquire a temporary facility.
There is no denying JKIA’s strategic importance to the country. Building a modern airport terminal is also not cheap business, even going by the controversial quote of Sh55 billion for the proposed second JKIA terminal.
As the main port of entry into the country, JKIA is the gateway through which well over 90 per cent of visitors first set their feet on Kenyan soil. When JKIA is inefficient or dysfunctional, economic production worth billions of shillings is lost.
As a budding regional hub, prolonged disruption at JKIA would put the facility at risk of losing out to rivals Ethiopia and South Africa.
Revenue and economic benefits generated from an efficient JKIA could well eclipse the cost of setting up the planned temporary terminal. But that still doesn’t answer the question as to what cost-benefit-analysis was used to settle on the option of buying a temporary terminal, whose lifespan is said to be about seven years.
By Kenyan standards, Sh2.34 billion is a lot of money that can go a long way in providing food, shelter, health and education to millions who live below the poverty line surviving on less than Sh107 ($1.25) per day.
Officials at the Treasury and the Ministry of Transport therefore owe Kenyans an explanation as to why it made more sense, for example, to buy the temporary terminal instead of leasing it.
With the massive Greenfield terminal and the nearly-complete Unit 4 coming on-stream, it would appear to a layman that it would have made more sense to lease than to buy a temporary terminal.
It has been argued that the pre-fabricated terminal could later be used by domestic airlines. If so, Kenyans need to be told what it will cost them to repair and maintain the facility, and compare this with the cost of building a domestic arrivals and departure terminal. In other words, the government is obligated to justify to the taxpayers how their cash is being spent.

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