NAC driving the transport and logistics dream

By Tiri Masawi
October 2016
Prime Business

While Namibia has plans afoot to be a logistical hub for the region offering the best transport services, infrastructure becomes a very key component of achieving this dream.

Enshrined in the National Development plans is the target to create a hive of activity in the transport and logistic sector to steer both job creation and rapid economic growth.

Prime Focus Managing Editor, Tiri Masawi, (TM) sits down with the Chief Executive Officer (CEO) of the Namibian Airports Company (NAC), Tamer El-Kallawi (TK) to unpack their role in making sure that the country’s Airports meet the envisioned dream of a vibrant transport and logistics hub.

Prime Focus: NAC has been executing projects to upgrade Airports countrywide, how has this project moved on and are you closer to where you want the Airports to be?

El-Kallawi: Some of the infrastructure projects have moved. We completed the passenger terminals at Ondangwa and Walvis Bay, two of our major regional airports. The runway rehabilitation at Ondangwa is nearly completed.

 With the support of the Ministry of Works & Transport, runway rehabilitation projects were completed at Walvis Bay and are underway in Katima Mulilo.

We have now a new fire station at Eros airport. However, we still have some challenges in kick-starting the major expansion project at Hosea Kutako International Airport and the runway rehabilitation at Eros Airport which are essential for our international and domestic operations. Hosea Kutako remains the major international access to and from Namibia while Eros is the base of our national carrier and government air transport operations.
Prime Focus: The country has seen the introduction of new Airlines including Qatar Airways and Ethiopian Airways, how does this push the country towards the dream of being a transport hub of the region?

El-Kallawi: The new airlines bring in additional opportunities for the Namibian travellers to reach destinations in Africa, Europe, and the Middle East.

Also, with the extensive routes networks of these new airlines, tourists and business passengers wishing to visit Namibia have a range of choices linked to the three major airlines alliances networks: Flying Blue for KLM, One World for Qatar Airways, and Star Alliance for Ethiopian Airlines.

 This goes a long way to achieve the national objectives of making Namibia a major transport hub in the region. Now, Namibia is on the map of each of those international airlines alliance networks which, combined, make a huge proportion of the international air traffic routes.

Prime Focus: How does the introduction of new Airlines in the Namibian route affect our economic performance?

El-Kallawi: The new airlines improve the positioning of Namibia on the air transport map. Ultimately, the new offerings will increase the number of tourists visiting Namibia, international business passengers will get access to our markets, and Namibia business travellers will get access to international markets contributing to increased exchange between Namibia and the rest of the world.

The above is expected to have a positive impact on our economy, with the National GDP benefitting from the spending of additional tourists in the country and new flows of exchanges between Namibia, Africa, Europe and the Middle East. In addition, each airline, as a company brings in its direct and indirect employment opportunities for Namibian individuals, travel agents, and sub-contracting companies for various services.

Prime Focus: As a company responsible for Airport standards and security, do you think as a country we compete well with the other countries in terms of airport infrastructure?

El-Kallawi: Namibia Airports Company is entrusted with the development, operations and maintenance of airports on behalf of the country, and on the basis of the standards established by the civil aviation regulator.

For that, we have infrastructure in place in some airports. However, we need to do more for our airports to reach the same level of capacity as our regional competitors.
Each of our neighbouring airports companies has either completed expansion, or is currently expanding the airport infrastructure to meet the forecasted air passenger traffic.
On our part, our flagship airport, Hosea Kutako International is operating well over its designed capacity, making it difficult to handle the current flow of traffic with the minimum comfort that modern travellers expect.

Prime Focus: What would you say are the major challenges faced by the company?

El-Kallawi: They are two major challenges for the company.
The airport infrastructure is ageing. In some instances, the capacity is not sufficient to accommodate the traffic demand.

The runways, taxiways and aprons at Eros and other regional airports have reached their life limit. I have already mentioned the capacity constraints at Hosea Kutako in terms of meeting the needs of the current air traffic, let alone the forecasted one.

The arrival of new airlines demonstrates the interests and strong beliefs that international airlines and their respective nations have in the potential of the Namibia economy and tourism industry. However, we need to invest in the expansions of the facilities to accommodate the current and forecasted air traffic. We also need to continue to rehabilitate the infrastructure at regional airports to support domestic travel by air.

Prime Focus: Hosea Kutako International Airport is still relying on a single terminal to accommodate both arriving and departing travellers are there any plans to construct a second terminal any time soon?

El-Kallawi: We had been engaging the government on the expansion of the facilities at Hosea Kutako International airport. We do not necessarily need a second terminal, but at least a larger terminal capable of handling the passenger traffic with the basic amenities that international and national travellers come to expect and NAC aspires to offer as part of its vision and contribution to Namibia vision 2030.

We are looking for a double level road/double level terminal system to provide for the segregation of departing and arriving, international and domestic passengers. The key is to increase the surfaces provided for public departure hall, passengers check-in, security controls, departure immigration, pre-boarding, boarding, arrivals immigration, baggage collection, public arrival hall, transfer, health controls, customs control, and baggage handling based on accepted international surface ratios per passenger appropriate to an acceptable level of service.

Prime Focus: How much would the NAC roughly need to construct the second terminal?

El-Kallawi: Our previous estimates (2015) were for a minimum of 200 Millions US Dollars for the passenger terminal to meet the forecasted traffic until the year 2040. However, the expansion of the terminal is not the only requirement at HKIA. We need to relocate and expand the aircraft apron to accommodate more and larger aircraft in conformity to the applicable national standards.

We also need to build a new runway meeting the requirements of large aircraft, and re-organize the taxiway system to meet the applicable requirements in particular in terms of the separation distances between taxiway and runway.  Indeed, some of the infrastructure and facilities at HKIA do not meet the safety requirements as set out in Namibia Civil Aviation Regulations (NAMCARS) 139 – Aerodromes and heliports: Licensing and operations and/or associated technical standards, and guidance material.

More specifically, the distance between the centre lines of the main taxiway and the main runway is 123 m which is below the required 182.5 m separation distance between the centre line of a taxiway and that of a runway of the characteristics of HKIA.
This separation distance is required to provide a safety margins between aircraft taxiing, landing or taking off from the airport. Moreover, parts of the aircraft apron are within the obstacles clearance surfaces, making an aircraft parked there a potential obstruction to other aircraft taxiing, landing or taking off. In addition, the total apron area is not sufficiently adequate to permit expeditious handling of the aerodrome traffic at its current maximum density.
 
Those equally important works require an additional 300 Million US Dollars as per our previous estimates (2015).

Prime Focus: NAC is one of the few parastatals that rely on self-financing without getting bailouts from Government what has been your success formula?

El-Kallawi: We do our best to utilize the resources generated in our operations to cover for the operational costs of providing services at our airports to our customer’s airlines, passengers and the travelling public. Our main source of revenue is the charges levied on aircraft and passengers.

We also tried to generate commercial revenues in our facilities by providing space for retail activities. The combination of aeronautical and non-aeronautical revenues allows for the company, overall to pay for the operational expenditures.
However, the funds required for the rehabilitation, improvements or extensions of facilities are beyond the level of revenue generated by NAC in its operational activities. That is where we call for the support of the government in major infrastructure projects.

In the long term, the expansion of airport facilities will also increase the opportunities for non-aeronautical revenues with the additional space that will become available for commercial activities.

Prime Focus: As a CEO of a public entity how do you plan to improve corporate governance in the company in future?

El-Kallawi: We are already implementing the requirements for corporate governance at all levels, with established procedures aligned to the national requirements for corporate governance procedures, and structures in place such as management, executive, and board committees. However, we need to strengthen our capabilities for internal audits so we can identify as early as possible any possible deviances from established procedures and address them accordingly.

Prime Focus: Where would you want the NAC to be under your leadership in the next five years?

El-Kallawi: The aviation industry is a very dynamic one. At the same time, airport infrastructure take time to mature and its realization even more.
It takes 1 to 2 years to finalize the preliminary, detailed design and tendering of a runway rehabilitation or new passenger terminal project, and another 2 to 3 years to actually complete the construction works. So, I would want to see in the next 5 years an NAC that has, if not completed, but at least reached a substantive level of realization of the projects needed to realize its vision for modern airport facilities to contribute the national vision 2030.

This includes of course the expansion of Hosea Kutako, the national flagship, the rehabilitation of the major facilities at the regional airports, and air cargo facilities, providing Namibia with integrated airports systems to support economic development and the tourism industry.
Prime Focus: Do you feel the support rendered to the parastatal by the Government financially if ever is sufficient is adequate?

El-Kallawi: As NAC, we have been receiving the support of the government on key infrastructure projects such as at Walvis Bay and Katima Mulilo. We will continue engaging the government for similar support at Hosea Kutako and Eros.

Prime Focus: What would you say have been the major successes of the company in the past five years?

El-Kallawi: Our current strategic plan focusses on specific 5 strategic priority areas related to: Safety and security compliance, expansion and modernization of the airport infrastructure, maintenance of infrastructure and equipment, revenue growth, and new organizational structure.
Airports infrastructure projects are quite complex, require more time, due to the combination of their huge costs and the fact that they have to be realized while the airport remains operational.

However, over the past five years, we made progress in all of our strategic areas and in particular, the completion of the construction of passenger terminals at Ondangwa and Walvis Bay, refurbishment of the runways at Ondangwa and Walvis Bay, as well as the re-arrangements of the passenger departure area at Hosea Kutako International.
We have also completed the acquisition of new Security equipment that were deployed through all the airports, a new fire station at Eros, and water reticulation at Hosea Kutako International. We have also successfully realigned our structures and operations to the national regulatory requirements leading to the completion of the licensing of Hosea Kutako International, Ondangwa, and Walvis Bay airports in conformity with national and international aviation standards.
We made progress with the implementation of the new structure, recruitment of additional personnel in areas such as rescue & firefighting, and engineering, and extensive training on safety compliance, to ultimately help us serve better our customers and stakeholders, and meet our regulatory obligations for the operations and maintenance of our airports in line with the national requirements established by our regulatory authority.   

Prime Focus: As a company do you feel you have managed to achieve your financial annual goals for this year?

El-Kallawi: In terms of revenue generation, we can say we have not yet achieved our goals, but we are surely moving into the right direction. However, we had to adjust the expenses, in particular in terms of salary & remuneration, and training, to cater for the requirements related to safety and security compliance.

 This has negatively impacted our overall financial performance. However, we recognize that these were overdue requirements to recruit and train operations, maintenance, and compliance personnel to meet our regulatory obligations.

Prime Focus: The country faces a severe shortage of scarce skills what programmes does NAC have to also help train Namibians in their fields?

El-Kallawi: NAC provided scholarships to 4 students in civil, and electrical engineering who have since joined the company and are undergoing a full training programme to qualify them as registered engineers in conformity with the requirements of the Namibia Engineering Council. We have extended the same scholarship opportunities to a new intake of 5 students early 2016. We also recruit our Rescue and fire officers at the basic level and provide them with the initial training to qualify as airport rescue and firefighting officers.

We also include in the training programme of our executive and managers theoretical training courses, familiarization with international airports operational environment, and practical On-The-Job training to allow them to be at par with their counterparts in the airports community worldwide. Finally, we include in all our consultancy services contracts a component of skills transfer to imparting skills to NAC staff involved in airport operations, maintenance, and engineering and compliance activities.

Prime Focus: What are your major beliefs to success as a CEO?

El-Kallawi: Hard working remains for me the cornerstone of success at every level. I was taught that at an earlier age and keep nourishing it for myself and those who work under my leadership.
Accepting responsibilities for not meeting the set objectives is another belief. As a CEO, I came to realize that empowering others is another key component of success.

That includes the ability to pick up the pieces when those you lead or develop let your down, and keep focus on the overall objectives of the company and its intended contribution to the nation’s strategic objectives.