Government has explored alternative sites in Vanua Levu for the construction of an airport, Acting Prime Minister and Attorney-General, Aiyaz Sayed-Khaiyum, revealed.

“We had been talking to the Asia Development Bank,” he said, while speaking in Parliament on Tuesday.”

“There was some funding that was available, but because of COVID-19, that has been put on hold.”

“We realised that there is still a lot more potential for regional development in Vanua Levu, including the areas of tourism.”

Three sites have been explored, he said.

“They most certainly are not in Labasa,” Mr Sayed-Khaiyum said.

Passengers waiting inside the airport terminal in Waiqele, Labasa on February 9, 2022. Photo: Shratika Naidu

“They most certainly are not in Savusavu.”

“They are somewhere where it could be easily accessible by both those two centres.”

He said the sites under consideration made sense, because of future and longer term prospects of landing larger aircraft in Vanua Levu.

“If you are able build an airport that has eventually the ability to look at landing a Boeing 737, and God knows one day A330 or A350, then that is a good site,” Mr Sayed-Khaiyum said.

The Labasa airport is situated between the bend of a river, which limits the prospects of an extension, he said.

Passengers coming out of airport in Waiqele, Labasa on February 9, 2022. Photo: Shratika Naidu

Rental Income
Mr Sayed-Khaiyum said Nadi Airport was the only airport that made money for Fiji Airports Limited.

“One of the major sources of revenue for international airports is not from landing fees anymore,” he said.

“It is about the concessions that are available at the airport, in other words, the rental.”

“Companies like Prouds and Tappoos were paying rental of about $3 million.”

“They are paying a combine of nearly $20 million, before COVID-19.”

It was one of the major reasons Fiji Airports was able to give a higher rate of return, he said.

The Labasa Airport. Photo: Shratika Naidu

Previously
Previous practice permitted the invitation to tender for space where price control measures were exercised, he said.

At the time, Tappoos was the higher bidder than Motibhai, he said.

Tappoos was given a bit more space, to allow them to continue to pay $3 million to $4 million, he said.

This, when the real estate of the airport was not realised, Mr Sayed-Khaiyum said.

But changes brought about have resulted in $8 million or $9 million each for rental spaces, he said.

“That is one of the major reasons revenue went up,” he said.

“And we have seen the re-development.”

Fiji Airports is 100 per cent owned by the Fijian Government.

The Labasa airport runway. Photo: Shratika Naidu.

Good Balance Sheet
Mr Sayed-Khaiyum said not all Fiji Airports developments at Nausori and Nadi airports were funded by the Fijian Government.

“It is funded by Fiji Airports because the balance sheet is good,” Mr Sayed-Khaiyum said.

“Private banks want to lend to them.

“Some rates they got were phenomenally cheap because of the asset base, the equity in the company.”

Rotuma Airport was however funded by the Government, because of the need to construct it.

Government grant was issued for outer island airport developments, he said.

“That is how the system works,” Mr Sayed-Khaiyum said.

“That is how balance sheets become strong.

“It is not relegating the outer islands as second class.”

The Government calls for tenders for airline services for Rotuma and other outer islands in Fiji, because of the lack of refuelling facilities, he said.

Northern Air and Fiji Link bid for it.

“If I am going to fly to some island in Lau, I do not take my full load,” Mr Sayed-Khaiyum said.

“I have to take half the load because I have to carry enough fuel to be able to fly back.”

The process, practised across some statutory bodies, is called the Universal Service Fund, he said.

“We take a certain percentage of their profit; put it in a Trust Fund,” Mr Sayed-Khaiyum said.

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