Airport Company closes in on US$230m loan

The Ghana Airport Company is to finalise arrangement for a syndicated loan of US$230million for the construction of a third terminal (T3) at the Kotoka International Airport.

“We have been able to at least put a finger on US$230million which is almost finalised. The company is almost at financial close with this facility. In all, we are trying to look at about US$400million,” said Mr. Twumasi Ankrah-Selby, Chief Director of the Ministry of Transport which has oversight responsibility.

Ecobank Ghana is leading a syndicate of banks to provide the US$230million funds

The GACL last year announced that it was to expand facilities at the Kotoka International Airport toaccommodate the increasing passenger throughput and increasing number of airlines servicing the KIA. Part of the proposal is the construction of a third terminal to be known as Terminal 3 within the KIA enclave.

This however requires huge capital outlay that the sole shareholder, government, is unable to provide given its limited budget.

Management of GACL, following the promulgation of the Airport Tax Amendment Act in 2013 -- which allows the GACL to retain 100 percent of its revenues -- turned to private capital to improve aviation infrastructure in the country.

Prior to amendment of the Act, 60 percent of all airport taxes went directly to the Ghana Revenue Authority to support the national budget -- while GACL retained just 40 percent.

Mr. Charles Asare, Managing Director of GACL earlier told B&FT that the company has set up a special fund solely for airport infrastructure. He said 70 percent of the revenue from its Airport Passenger Service Charge (APSC) will be kept in the fund to service the loan.

Latest figures obtained from airport authorities show a significant growth in transit passengers and cargo throughput for the Kotoka International Airport (KIA) for 2014, pointing to the growing importance of Ghana as an aviation hub in the sub-region.

Transit passengers increased from 162,000 in 2013 to 178,000 in 2014, representing an increase of some 9.5 percent. Cargo throughput also increased by 24.5 percent from 44,000 tonnes in 2013 to 54,000 tonnes in 2014.

The increase in transit passenger throughput has been attributed to the growing presence of regional and international airlines in Ghana and the choice of consumers to use the KIA for on-ward connections to mainly Europe, the Gulf, and Asia due to the good safety record of the country -- bar the recent cargo aircraft accidents in recent times.

Growing transit passenger throughput is positive for revenue generation as airlines pay navigation charges and various taxes.