2016 World Bank Air Transport Annual Report.Pdf

In 1952, 65 years ago, the International Bank for Reconstruction and Development granted a US$ 7 million loan to KLM Dutch Airlines. This loan, which supported a $33.5 million re- equipment program involving the acquisition of twenty-three aircraft for KLM, was the 59th loan of the World Bank since its creation in 1944. However, loan 59 also marked the first financing in the air transport sector of a client country, the Netherlands, recognizing the importance of the sector for the economic development of post-war Europe.

The 12th edition of the World Bank Group (WBG) Air Transport Annual Report, summarizes the current portfolio of the air transport practice at the WBG, and highlights some of the projects in more detail. Over the past 65 years, the WBG has engaged in various projects that aimed at supporting the development of sustainable air transport networks. The types of projects range from aircraft acquisitions, airport and air traffic control infrastructure investments, capacity building in regulatory oversight, advise on aviation policy matters and environmental issues, as well as fostering private sector participation in air transportation in emerging markets.

The global Air Transport Industry continues on its successful path, marked by strong growth especially in certain emerging markets, and healthy consolidation in more mature regions. While air cargo still remains somewhat below expectations, passenger growth is solid and air travelers are forecasted to double by 2035. Globally, the air transport industry now supports 63 million jobs and US$2.7 trillion in global GDP.

The improved performance of the sector has made investments in air transportation more attractive. For a second year, airlines’ return on capital exceeded their cost of capital on a global scale, and many mid-sized airports in emerging markets are able to attract private capital to finance needed infrastructure expansion. Nevertheless, not all regions experience strong financial performance. For example, while the Asia-Pacific carriers were able to post a profit of US$ 900 million in 2016, African airlines lost US$ 800 million, and many Africa airports still experience insufficient traffic for being able to finance needed investments.

The WBG continues to recognizes the potential of air transportation to contribute to economic development and shared prosperity. However, given the heterogeneous development of the sector in emerging markets, it is important to focus support and investments in regions and markets where the private sector is challenges by low or negative returns. This explains the declining number for public sector airport projects, as well as the WBG’s enhanced focus on Public-Private Partnerships in airport infrastructure projects.

This report summarizes the WBG air transport development activities, which include an overall portfolio of US$1.24 billion, and several analytical and technical research products. With this activity we remain actively engaged around the world on air transport development, by addressing policy and regulation, safety, infrastructure rehabilitation, institutional strengthening, and capacity building in client countries. Finally, environmental challenges of aviation, and how to mitigate them in emerging markets, continue to be a top priority for the WBG, which we address in cooperation with strategic partners.

We look forward to continue addressing the challenges and opportunities of the sector in 2017 to help achieving safe, affordable, and sustainable air transportation for all.

Dr. Charles E. Schlumberger Lead Air Transport Specialist The World Bank Group

ACI Airports Council International ADS-B/C Automatic Dependent Surveillance– Broadcast/Contract AGL Aeronautical Ground Lights ATC Air Traffic Control ATM Air Traffic Management BOT Build-Operate-Transfer BOO Build-Own-Operate BOOT Build-Own-Operate-Transfer BTO Build-Transfer-Operate CAA Civil Aviation Authority CES Charles E. Schlumberger, Lead Air Transport Specialist (WBG) DME Distance Measuring Equipment GNSS Global Navigation Satellite System EASA European Aviation Safety Agency EC European Commission ESW Economic Sector Work FAA Federal Aviation Administration (United States) FY Fiscal Year IATA International Air Transport Association IASA International Aviation Safety Assessment (FAA) IBRD International Bank for Reconstruction and Development (WBG) ICAO International Civil Aviation Organization (UN Agency) IDA International Development Association (WBG) IFC International Finance Corporation (WBG) ILS Instrument Landing System IOSA IATA Operational Safety Audit LCC Low-Cost Carrier MIGA Multilateral Investment Guarantee Agency (WBG) PPPA Public Private Partnership Agreement PPP Public-Private Partnership SARPS Standards and Recommended Practices TA Technical Assistance DOT Department of Transportation USOAP Universal Safety and Security Oversight Audits Program (ICAO) VOR VHF Omni-Directional Radio Range VSAT Very Small Aperture Terminal WB World Bank WBG World Bank Group WRSS World Routes Strategy Summit

This report benefited from the contributions of a number of staff members from across the World Bank Group.

We would like to thank Shruti Vijayakumar, Adam Diehl, Niloo Gahemi, Christopher J. De Serio, Christopher Bennet, Nora Weisskopf, Anita Lakshmi Fernando, Justin Runji, Mauricio Navarro, Amali Rajapaksa, Victor Dato, Dina Elabd, Yonas Eliesikia Mchomvu, Michelle Sade Kayosa Ajayi, To- joarofenitra Ramanankirahina, Carlo Bongianni, Paul Brenton, Anca Cristina Dumitrescu, Bertrand Murguet, Paula Pardo Pachon, Ramatou Magagi and Carlo Bongianni.

We would also like to thank Pierre Guislain, former Senior Di- rector and Jose Luis Irigoyen, Senior Director of the Transport and ICT Global Practice for their continued guidance and support, and Aldo Giovannitti for the research and preparation of this report.

report. this in covered be not will but the WBG, of part a also is (ICSID) Disputes ment Invest- of Settlement for In- Centre The ternational in- countries. direct developing in foreign vestment facilitate to or guarantees insurance risk political provides Agency (MIGA) The Guarantee countries. Investment Multilateral sector developing private in stimulate investment to services sory advi- and equity, Corpora- loans, provides (IFC) Finance tion International The middle tries. of low creditworthy governments (IBRD), and income to lends Development which Re- and for Bank construction International the is arm ing lend- by original Bank’s World The grants. and countries interest poorest that providing world’s Bank World the the of helps part the is (IDA) Association Development International The Structure New and Institutions The and agriculture, ICT. and transport development, sector private administration, public edu- health, cation, including sectors of number a across ty. socie- civil as well as and actors, sector public private relevant with partnerships and tackle to - cutting aims financing, through Group challenges these Bank World The   2030: by goals major two achieve to aims Group Bank World The services. sory advi- and guarantees credits, grants, low loans, of provision the the around through assis- world countries technical developing and to tance vital financial a of is (WBG) source Group Bank World The Mission The edge solutions, cross solutions, edge

the population in every country. every in population the of percent 40 bottom the of income the boosting by prosperity shared Promote percent. 3 than more no to day a $1.25 than less on living people of percentage the decreasing by poverty extreme End The organization’s investments span span investments organization’s The

- free loans, or credits, credits, or loans, free - sectorial knowledge, knowledge, sectorial - income coun- income

- interest interest

allows people to interact and generate the the generate and interact to and people of world; allows the supply around services the and enables goods and it education, services; jobs, health to people connects infrastructure Transport development. social and economic of driver critical a is Transport Connectivity and Mobility Enhancing and prosperity. shared poverty boosting extreme ending of goals twin the meeting toward work ultimately and ity, improve sustainabil- to financial efficiency, intended operational are institution. changes the These improve across and sharing knowledge collaboration strengthen to and Cross Practices Global with new structure Bank’s nimble The Practice. Global a now is ICT major and Transport and undergone change, institutional recently has WBG The connectivity on a national, regional, and regional, national, a on vital connectivity provides and economy global the into integration facilitates employ- It creating opportunities. ment and tourism, promoting trade, generating integration, economic ing facilitat- in particularly development, tering fos- in role important an plays transport Air billion. US$48 around of with portfolio active an globally, transport for devel- finance of opment provider largest the is WBG The Bank’s work. policy the and investments guide infrastructure principles three These would that be countries developing for solutions mobility envisioned 2008, in adopted World The connectivity. Bank’s greater for cross tions innovative deliver and large sup- to port positioned uniquely is Group Bank A greater mobility. through development human trade enhanced efficientand more facilitated have ments invest- transport Bank’s World The growth. andlongsolutionsknowledgethatfoster a multi a s

safer, cleaner and more affordable. affordable. more and cleaner safer,

- Cutting Solution Areas is designed designed is Areas Solution Cutting

strategy in the transport sector, sector, transport the in strategy - scale transformational projects projects transformational scale - sectorial institution, the World World the institution, sectorial

- utn solu- cutting - term

international scale. However, in many countries air Current IBRD projects in air transport include the transport equipment and infrastructure, regulatory Cairo Airport Development Project, which is being frameworks, and safety and security oversight sys- funded through a US$280 million loan, the Shan- tems are inefficient or inadequate. grao Sanquingshan Airport, which is being funded through a US$50 million loan, and the US$52 mil- In view of these challenges and to assist clients in lion DRC Goma Airport Safety Improvement Pro- establishing a safe, secure, cost efficient, accessi- ject. Additionally, the US$285 million Aviation ble and reliable air transport network, the Bank is Modernization Project in Kenia is currently in the mandated to undertake the following major activi- pipeline. ties:

 Operational work through projects and tech- Major current commitments by the International nical assistance. Finance Corporation (IFC) in FY16 include  Economic sector work, research, and ASECNA in Africa, Queen Alia II in Jordan, the Za- knowledge dissemination on air transport relat- greb Airport in Croatia, the Enfidha airport con- ed issues. struction in Tunisia and the Pulkovo Airport in the  External relations and collaboration with part- Russian Federation. IFC is active through Advisory ner organizations. Services in Jamaica, Saudi Arabia and Santa Lu-  Internal services (such as the airline advisory cia. MIGA has been involved in the air transport service for WBG staff travel). sector in the past through the issuance of guarantees for two airport projects in Ecuador and Peru. Portfolio and Project Highlights In Fiscal Year 2016 (FY16), WBG’s Air Transport Research and External Relations Portfolio amounted to US$1.24 billion, a decrease World Bank staff members continue to represent of 9% from Fiscal Year 2015 (FY15). The Air the organization externally at various air transport Transport segment makes up around 2.6% of the conferences and events, notably the ACI-WBG WBG’s US$48 billion Transport portfolio. The Aviation Symposium in London, UK. Research and WBG’s FY16 Transport portfolio consists approxi- knowledge dissemination also continue to consti- mately 18.6% of the WBG’s active portfolio of tute critical functions of the WBG’s Air Transport US$259 billion (excluding MIGA). Community of Practice (ATCOP). Looking forward, the practice maintains its strong commitment to The Air Transport portfolio includes some 72 pro- addressing the challenges of its client countries. jects or project components through the Interna- tional Bank for Reconstruction and Development (IBRD) and International Development Association (IDA), as well as the International Finance Corpo- ration (IFC)’s portfolio of lending and non-lending products in the aviation sector.

Project highlights in 2016 include the approval of four Additional Finance for the aviation investment projects in Tonga (US$7.3 million), Tuvalu (US$2.9 million), Samoa (US$16.6 million) and Kiribati (US$7.1 million) as part of the Pacific Avia- tion Investment Program (PAIP). PAIP is currently being implemented in Vanuatu, Kiribati, Tonga, Tuvalu, and Samoa.

The WBG is a vital source of financial and technical assistance to developing countries through low-interest loans, credits, and grants. In Fis- cal Year 2016, the World Bank's Air Transport Portfolio is around US$1.24 billion. This included a total of 72 lending and non-lending projects or project components through the International Bank for Reconstruction and Development (IBRD) and International Development Associa- tion (IDA), as well as the International Finance Corporation (IFC)’s portfolio of lending and investment advisories in the aviation sector.

Active Portfolio IBRD IDA IFC TOTAL

(in millions USD) FY16 FY15 Change FY16 FY15 Change FY16 FY15 Change FY16 FY15 Change

WB Group Total Ac- 108,282 99,574 8.75% 99,068 92,334 7.29% 51,994 50,402 3.16% 259,344 242,310 7.03% tive Portfolio

WB Group Active 28,510 26,817 6.31% 16,520 16,078 2.75% 3,091 2,930 5.49% 48,121 45,826 5.01% Portfolio-Transport

Transport % of Total 26.33% 26.93% -0.60% 16.68% 17.41% -0.74% 5.95% 5.81% 0.13% 18.55% 18.91% -0.36% Active Portfolio

Air Transport Active 325 325 0.00% 420 507 -17.14% 496 535 -7.20% 1,241 1,367 -9.17% Projects

% of Total Active 0.30% 0.33% -0.03% 0.42% 0.55% -0.12% 0.95% 1.06% -0.11% 0.48% 0.56% -0.09% Portfolio

% of Total Transport 1.14% 1.21% -0.07% 2.54% 3.15% -0.61% 16.06% 18.26% -2.20% 2.58% 2.98% -0.40% Portfolio

Note: Excluding the Multilaterial Investment Guarantee Agency (MIGA) analytic/advisory services. infrastructure and building well investments, assistance as technical and as airof transport projects worldwide focusing on regulatory capacity reform, AirActive FY15: in Projects Transport

IBRD and IDA invest in a number a number in invest IDA and IBRD

IBRD AND IDA LENDING PROJECTS

WGB Commitment Status as of Project Description of Aviation Compo- (Million US$) Region Country Project Name Type End of Code nent Aviation Total FY2016 Component

Burkino Faso Donsin Technical assistance for new Ouagadougou Africa Burkina Faso P120960 Transport Infrastruc- 85.0 1.7 IDA Credit Active Airport ture Project

Cape Verde -Transport Institutional capacity building, technical as- Africa Cape Verde P126516 19.0 2.1 IDA Credit Active Sector Reform Project sistance, and support of national airline

Democratic Improve the safety, security, and operations Goma Airport Safety Africa Republic of P153085 of Goma International Airport through infra- 52.0 45.2 IDA Grant Active Improvement Project Congo structure investments and capacity building.

Democratic Multi-Modal Improve transport connectivity and support Africa Republic of P092537 435.0 43.5 IDA Grant Active Transport economic integration in the region Congo

Transport Sector Sup- Enhance aviation security and safety, and Africa Kenya P124109 503.5 45.3 IDA Credit Active port Project improve institutional capacity

Northern Corridor Enhance aviation security and safety, and Africa Kenya P082615 Transport Improve- 460.0 69.0 IDA Credit Closed improve institutional capacity ment Project WGB Commitment Status as of Project Description of Aviation Compo- (Million US$) Region Country Project Name Type End of Code nent Aviation Total FY2016 Component

Second Central Improve Zanzibar Airport facilities and build Africa Tanzania P103633 290.0 26.1 IDA Credit Active Transport Corridor capacity

Transport Sector Sup- Rehabilitation and extension of regional air- Africa Tanzania P055120 329.0 69.1 IDA Credit Active port Project ports

Improve airline connectivity and environ- East Asia Shangrao Sanqingshan mental sustainability of development and China P123729 50.0 48.0 IBRD Loan Active and Pacific Airport Project operation of the Shangrao Sanqingshan Air- port

Infrastructure investment, sector reform and East Asia Pacific Aviation Invest- Kiribati P128938 training, and strengthening airport opera- 30.0 25.5 IDA Grant Active and Pacific ment - Kiribati tions and management capacity

Infrastructure investment, sector reform and East Asia Kiribati Aviation In- Kiribati P153381 training, and strengthening airport opera- 7.1 5.5 IDA Grant Active and Pacific vestment Project AF tions and management capacity

East Asia Pacific Is- Pacific Aviation Safety Strengthen the Pacific Aviation Safety P145057 2.2 0.3 IDA Grant Active and Pacific lands Office Reform Office’s technical and coordination capacity IBRD AND IDA LENDING PROJECTS (continued)

WGB Commitment Status as of Project Description of Aviation Compo- (Million US$) Region Country Project Name Type End of Code nent Aviation Total FY2016 Component

East Asia Samoa Aviation In- Samoa P143408 Improve operational safety and oversight 41.6 38.3 IDA Grant Active and Pacific vestment Project

East Asia Samoa Aviation In- Samoa P157241 Improve operational safety and oversight 16.62 15.3 IDA Grant Active and Pacific vestment Project AF

Infrastructure investment, sector reform and East Asia Pacific Aviation Invest- Tonga P128939 training, and strengthening airport opera- 34.5 26.5 IDA Grant Active and Pacific ment - Tonga tions and management capacity

Infrastructure investment, sector reform and East Asia Tonga Aviation Invest- Tonga P156018 training, and strengthening airport opera- 7.25 5.7 IDA Grant Active and Pacific ment Project AF tions and management capacity

Tonga Transport Sec- East Asia Improve safety and security compliance; Tonga P096931 tor Consolidation Pro- 9.4 4.2 IDA Grant Active and Pacific provide technical assistance to CAA ject

Infrastructure investment, sector reform and East Asia Pacific Aviation Invest- Tuvalu P128940 training, and strengthening airport opera- 20.8 18.1 IDA Grant Active and Pacific ment - Tuvalu tions and management capacity WGB Commitment Status as of Project Description of Aviation Compo- (Million US$) Region Country Project Name Type End of Code nent Aviation Total FY2016 Component

Infrastructure investment, sector reform and East Asia Tuvalu Aviation In- Tuvalu P157779 training, and strengthening airport opera- 2.88 1.7 IDA Grant Active and Pacific vestment Project AF tions and management capacity

Improve operational safety and oversight of East Asia Pacific Aviation Invest- Vanuatu P154149 international air transport and associated 59.5 54.7 IDA Credit Active and Pacific ment -Vanuatu infrastructure

Latin Amer- National Roads and Infrastructure development; improve safety, ica and Car- Bolivia P122007 Airport Infrastructure security and operational reliability of the 109.5 5.5 IDA Credit Active ibbean Project Rurrenabaque Airport

Latin Amer- Grenada, St. Regional Disaster Vul- ica and Car- Vincent, the P117871 nerability Reduction Improve emergency response capability 56.5 13.6 IDA Credit Active ibbean Grenadines Project (APL1)

Middle East Build capacity of Cairo International Airport; Cairo Airport Develop- and North Egypt P101201 rehabilitation and expansion of Terminal 280.0 277.2 IBRD Loan Active ment Project-TB2 Africa Building 2; safety and security

Middle East Port Cities Develop- Improve efficiency, and rehabilitation and and North Yemen P088435 22.1 3.76 IDA Grant Active ment II Project extension of Mukalla Airport Africa

Active

Closed

Pipeline Pipeline Pipeline Pipeline

End of of End of End

FY2016 FY2016

Status as of of as Status

IDA IDA

IBRD

Blend

Type

ESW

Type

7.2

18.0 10.0

228.0

20% 20%

100% 100%

nent

Aviation Aviation

Compo-

Component

(Million US$) (Million

60.0 30.0

Total 285.0 100.0

WGB Commitment Commitment WGB

met services in Africa in services met

nent

LENDINGPROJECTS

framework

prove safety prove

tional standards tional

means to regional economic integration economic regional to means

Increase regional connectivity regional Increase

Description of Aviation Component Aviation of Description

Modernization of Hyrdo of Modernization

Help the Government to maintain high high maintain to the Government Help

Policy reform roadmap to develop air transport as a a as transport air develop to roadmap reform Policy

Description of Aviation Compo- Aviation of Description

Reduce transport connectivity cost and im- cost and connectivity transport Reduce

ers modernization of Kenyan major airports airports major Kenyan of modernization ers

The proposed project involves amongst oth- amongst involves project The proposed

growth within a sustainable macroeconomic macroeconomic sustainable a within growth

including enhancing security to meet interna- meet to security enhancing including

Phase 3 Phase

—

Project

Connectivity Connectivity

Links

Project Name Project

Tajikistan DPO Tajikistan

and Central Africa Central and

Project Name Project

Modernizing Hyrdo Modernizing

Paraguay Transport Transport Paraguay

met services in Africa in services met

Air Transport in West West in Transport Air

Central Asia Regional Regional Asia Central

IBRD AND IDA PIPELINE PROJECTS ANDIDA IBRD

Airport Modernization Modernization Airport

IBRD AND IDA NON ANDIDA IBRD

Code

P149328 P154343

Project Project

P156971 P159220 P126273 P147278

Project Project

Kenya

Regional Regional

Country

Paraguay

Tajikistan

Country

Central Asia Central

Asia Asia

Africa Africa

Africa

ibbean

Central Central Central

Region

Latin Amer- Latin i

Active Active Active

Closed Closed Closed

FY2016

Status as as Status

of End of of End of

TA TA TA

ESW ESW ESW

Type

20% 10% 15% 20% 10% 20%

nent

Compo-

Aviation Aviation

China

preparation

nectivity in the region the in nectivity

in developing countries developing in

(CAZ) through support to capital budget TA budget capital to support through (CAZ)

The objective is to investigate the effects of effects the toinvestigate is The objective

Pacific economies as a conduit for economic economic for conduit a as economies Pacific

Description of Aviation Component Aviation of Description

growth, job creation and trade by fostering air air fostering by trade and creation job growth,

various levels of transport connectivity (access (access connectivity transport of levels various

Assist in the reform of Civil Aviation Zimbabwe Zimbabwe Aviation ofCivil reform the in Assist

connectivity is characterized spatially, and how and spatially, is characterized connectivity

transport connectivity on a LCR subregion, how how a subregion, LCR on connectivity transport

and costs) can ultimately create more equitable equitable more create ultimately costs) can and

Support tourism development in selected South South selected in development tourism Support

Regional strategy and roadmap for improved con- improved for roadmap and strategy Regional Modelproject and preparation project to Support

Strengthen global hydromet systems and improve improve and systems hydromet global Strengthen

weather, climate and hydrological service delivery delivery service hydrological and climate weather,

travel connectivity between the Pacific Islands and and Islands Pacific the between connectivity travel

LENDING(continued) PROJECTS

Pa-

Transport

toZIMREF

cific Possible cific

structure service structure

and Partnerships and

LCR Connectivity and and LCRConnectivity

Tajikistan Multimodal Multimodal Tajikistan

Equity: Regional Study Regional Equity:

Project Full Name Full Project

Host to the World World the toHost

PPP for transport infra- transport PPPfor

Knowledge Management Management Knowledge

Transport Sector Support Support Sector Transport

P157125 P156927 P155515 P152420 P157817 P151023

Project Project

ID Code ID

Brazil

Multi

IBRD AND IDA NON IDA AND IBRD

Regional

Tajikistan

Country

Zimbabwe

Latin America Latin

Pacific Islands Pacific

bean bean

Africa

Multi

Pacific

Regional

Region

Europe and Europe and

Central Asia Central

Latin Ameri- Latin Ameri- Latin

ca and Carib- and ca Carib- and ca East Asia and and East Asia

IBRD AND IDA NON-LENDING PROJECTS (continued)

Aviation Status as Project Region Country Project Full Name Description of Aviation Component Compo- Type of End of ID Code nent FY2016

Multi- Multi- Global Hyrdomet Sys- Strengthen National Meteorological and Hydro- P156930 10% TA Active Regional Regional tems logical Services

Development of Domes- Introducing private sector participation in the de- South Asia Sri Lanka P146193 100% TA Closed tic Airports velopment of domestic airports in Sri Lanka

CABO VERDE aid flows, UN operations, and passenger and car- Cabo Verde Transport Sector Reform Pro- go transport. There have been seven recorded air ject (P126516) crashes since 2002 at the airport with dozens of fatalities, many of them attributed to the condition The objective of the project, in the IDA amount of of the airport. US$19 million, is to improve efficiency and management of the national road assets and to lay the The project will restore the airport’s runway origi- groundwork for transport sector State Owned En- nal length, rehabilitate the apron, existing passen- terprise reform. Among the concerned transport ger and cargo terminals, and electrical system, as sector State Owned Enterprises is TACV, the na- well as supply a new low-cost control tower and tional airline company, which is structurally in defi- navigational equipment to upgrade air navigation. The project will also include the construction of the cit. Making the right decision on TACV requires strong political will and leadership given the sensi- airport’s security fence and support airport rescue tivity of the company in Cabo Verde. Following a and firefighting services. request from the new Government, the World Bank has conducted a mission to analyze the situation The project will support the valorization of the of TACV in order to recommend the appropriate large quantity of lava rock removed from the airway forward. The mission has developed several port through labor-intensive activities targeted to restructuring options concerning domestic traffic communities living close to the airport. The project and international traffic. Follow-up activities are will also complement a Japan-GFDRR grant sup- underway to allow the Government to make an in- porting the monitoring of volcano risks and formed decision on the future of TACV. strengthening preparedness of the airport and sur- rounding communities. The significance of the pro- Contact person is Tojoarofenitra Ramanankirahina ject is evident – DRC’s landmass is almost as at [email protected]. large as the whole of Western Europe, therefore transport remains key to increasing agriculture, improving trade, supporting mining growth, over- coming the economic and social barriers that iso- DEMOCRATIC REPUBLIC OF CONGO late communities, and providing security through- out the country. Goma Airport Safety Improvement Project

(P153085) Contact person is Noroarisoa Rabefaniraka at

[email protected] In FY15, the World Bank’s Board approved a

US$52 million IDA grant to help improve the safety, security, and operations of Goma International

Airport, the main international gateway of Eastern DEMOCRATIC REPUBLIC OF CONGO Democratic Republic of Congo (DRC) and repair the infrastructure. The airport is a vital link to con- Multi-Modal Transport Project necting the area to the rest of the country and sup- (P092537) porting ongoing peace consolidation efforts. In addition to decades of conflict, the most significant The Bank approved a US$255 million IDA grant for damage to the airport’s sole runway and taxiway the Multi-Modal Transport Project in the Democrat- resulted from the 2002 Mount Nyiragongo volcano ic Republic of Congo (DRC) in 2010 as well as a eruption. US$180 million additional financing IDA grant in 2013. The project’s main objectives are to (i) im- The lava flow from the volcano buried more than prove transport connectivity in the DRC, (ii) to re- one third of the 3,000-meter runway and isolated store Société Nationale des Chemins de Fer du the terminal and apron, constraining humanitarian Congo (National Railway Company of DRC,

SNCC) financial and operational viability, and (iii) tion. The government adopted a sector wide strat- to strengthen transport state-owned enterprises egy in 2014 and a technical assistance from ICAO (SOEs) operational performance. has to started in 2016.

The project’s four main components include: (1) Contact person is Mustapha Benmaamar SNCC recovery plan, (2) operational performance [email protected] strengthening and improved governance of the sector, (3) international trade procedures simplifi- cation, and (4) project management. Most of the project financing (85%) go to the railway compo- KENYA nent. The sub-component dedicated to aviation will Transport Sector Support Project (P124109) help DRC move towards compliance with interna- and Northern Corridor Transport Improve- tional safety and security standards through the ment Project (P082615) supply and installation of critical equipment for air traffic control and airspace control. The sub- A US$300 million IDA commitment was approved component is financing (US$ 15 million): (i) the in 2011 for the Transport Sector Support Project in procurement and installation of ADS-B surveillance Kenya. The project’s objective is to increase the equipment by the National Airways Management efficiency of road transport, raise aviation safety Agency/Regie des Voies Aeriennes in 5 airports and security at Kenya’s airports to international (RVA), the organization in charge of airports, (ii) a standards, and improve the institutional arrange- new category II ILS/VOR/DME system for the capi- ments and capacity of the transport sector. tal’s international airport Kinshasa/N’Djili (FIH), (iii) two studies on the development of airports in the Following the fire at Jomo Kenyatta International country (one on freight development at FIH, and Airport (JKIA) in August 2013 that destroyed the one on secondary airports), (iv) training for RVA only international arrival building, the Bank provid- personnel in air traffic control, airport rescue and ed an additional financing component of US$60 firefighting services, and (v) the strengthening of million to help finance activities to restore the ca- the National Civil Aviation Agency, which is in pacity of the international passenger terminal de- charge of overall regulation of the sector. (vi) a stroyed in a fire at JKIA, strengthen KAA in disas- recertification campaign for the five largest air- ter preparedness and responsiveness at Kenyan lines. airports, and fill any unanticipated financing gaps.

Most of the emergency activities at JKIA following Key activities related to aviation have already been the fire incident have either been completed or are implemented, albeit with some delays in procure- nearing completion. ment and reforms. The study on the cargo zone in

Djili airport and the study on secondary airports The aviation component of the project entails are complete. The installation of the navigation as- providing support to the Kenya Civil Aviation Au- sistance systems (CNS/ATM and 5 ADS-B) is on- thority (KCAA) in regulatory capacity building and going and the equipment is expected to be opera- through specific investments in navigation aids tional by January 2017. Landing assistance sys- and training equipment. In addition, support to tems (ILS/DME) are installed but not operational at Kenya Airports Authority (KAA) will include provi- N’Djili airport while the DVOR/DME initially pro- sion of a new baggage-handling system at Jomo cured for Kinshasa airport will eventually be in- Kenyatta International Airport (JKIA), and capacity stalled at Kalemie airport. building and training of manpower in safety, secu-

rity, and airports management. There still remain areas of improvement for the reform of governance in the aviation sector. Five of As planned under the project, the Government of the largest airlines in DRC seeking recertification Kenya agreed to the restructuring of the KCAA by initially failed to provide the requested documenta- separating the oversight function from its service

provision responsibilities to improve effectiveness of oversight services and contribute to enhanced efficiency among service providers. Both KAA and KCAA have been given financial autonomy and now retain revenues generated. As part of this process, KCAA has increased the pay packages for key flight safety operations staff, which is critical for carrying out its oversight function. Furthermore, KAA has taken over the responsibility of screening passengers and baggage from the Kenyan police. A consultant has been selected and is assisting in the restructuring process.

KAA has to conclude the procurement of several outstanding contracts including reconstructing the runway at MIA Mombasa, design for upgrading power supply at MIA, design for augmenting water supply at JKIA, MIA and Kisumu airport, and supply of apron buses at JKIA.

Implementation on the Northern Corridor Transport Improvement Project is on track as well, despite some delays. The expansion of apron at JKIA and taxiways has increased the capacity of parking space for aircrafts by 50 percent, and expanded the capacity of the runway. The selection of a consultant to update the detailed designs on the re- modeling, renovation and expansion of Units 1, 2, and 3 at JKIA is nearing completion but with modi- fied scope of the assignment that has to take into account the impact of the fire incident. The construction of Terminal 4 (renamed T 1A) is completed and the terminal is in use.

Expansion and improvements at Kisumu airport is now complete, and has contributed to the stimula- tion of economic activities in Western Kenya. Traf- fic at the airport has grown from 40,000 passengers at the time of appraisal to 400,000 in the year 2013.

Contact person is Josphat O. Sasia at [email protected].

TANZANIA TANZANIA Transport Sector Support Project Second Central Transport Corridor Project (P055120) (P103633)

In May 2010, the Bank approved a credit of Approved for a credit of US$190 million on 27 May US$270 million for the Transport Sector Support 2008, and additional financing of US$100 million Project (TSSP) in Tanzania. In support of the on 15 January 2013, the Second Central Transport Transport Sector Investment Program (TSIP), the Corridor Project (CTCP2) in Tanzania aims to sup- project’s goal is the rehabilitation and preparation port the country’s economic growth by providing of designs for part of the paved national road net- enhanced transport facilities that are reliable and work, and the rehabilitation and/or upgrading of cost effective, in line with the National Transport regional airports. Policy and Strategy. This includes the establishment of the Bus Rapid Transit (BRT) system in Dar The project received additional funding (AF) of es Salaam and the rehabilitation and extension of US$59 million on 30 June 2011. This prompted the Zanzibar airport runway. revision of the project development objectives and expanded the scope of the aviation component. The Zanzibar airport component (US$39.3 million) The component for airport upgrades and rehabilita- was implemented successfully between April 2009 tion includes (i) the paving and rehabilitation of the and July 2010 and was completed officially on 3 runway at Kigoma airport (ii) the rehabilitation of August 2010. The airport’s runway was rehabilitat- the main runway at Tabora airport, as well as (iii) ed and extended by 560 meters, from 2,462 me- the extension, rehabilitation and paving of the run- ters to 3,022 meters long. Other works included way and the replacement of the apron, terminal runway marking, the construction of a perimeter and car parking at Bukoba airport, which were access road, repair and provision of new aeronau- signed in FY12. tical ground lights (AGL), and provision of a new filter drainage system on each side of the runway The works at Kigoma and Tabora Airports has for the full length. been completed and final acceptance was done in June 2014. The Bukoba airport runway, and apron The project also financed the detailed design for were also completed and final acceptance was the rehabilitation and extension of Zanzibar airport done in December 2014. The construction of Buko- taxiways and apron and technical assistance to the ba airport terminal building was completed and Zanzibar Ministry of Infrastructure and Communi- provisionally accepted in September 2015. The cation. The apron and taxiway rehabilitation works extension, and rehabilitation and widening works were implemented under the additional financing of the main taxiway (taxiway C), and the construc- credit of IDA’s Transport Sector Support project tion of the new apron, taxi way D, and a new link (TSSP), with an allocation of US$57.23 million for taxiway in the Zanzibar airport are completed and works and supervision. The project improved safe- final acceptance is expected within January 2016. ty and customer satisfaction and has enabled an The feasibility study and detailed engineering de- increase in the number of commercial regular sign of eleven regional airports as well as the flights to Zanzibar. preparation of the Civil Aviation Master Plan have also been completed under the project. Contact Person is Yonas Mchomvu at [email protected] Contact person is Negede Lewi at [email protected] and [email protected]

CHINA The project is well on track to achieve its PDO. Shangrao Sanquingshan Airport Project The physical components of the project progress (P123729) well with 82% of the WB loan disbursed to date. The construction of the whole airport is approach- A US$50 million IBRD commitment for the Shan- ing to the end before 2017, and the overall ac- grao Sanqingshan Airport Project was approved in ceptance by the Civil Aviation Administration of May 2013. The overall objective of the project is to China (CAAC) will follow. It is planned that the improve airline connectivity in the northeastern Shangrao airport will be on operation in May 2017, Jiangxi province, as well as demonstrate the envi- with several commercial airlines connecting to dif- ronmental sustainability of the development and ferent domestic large cities. operation of the Shangrao Sanqingshan Airport. Airport Acceptance: The regional bureau of CAAC Component 1: The first component of the project had the acceptance inspection for the completed covers the airport infrastructure development and air-related infrastructure in Aug 2016. The Shan- includes the construction and installation of the grao municipal construction had the acceptance following: (a) airfield, runway, taxiway, etc.; (b) ter- inspection on the non-airfield buildings and munici- minal building; (c) air traffic control; (d) freight fa- pal engineering works in Sep 2016. Certain recom- cility; (e) supporting infrastructure facility, including mendations were provided by the inspections, and fuel storage farm, water supply, water supply, the contractors are finalizing the civil works and power supply, fire stations, heating, storm/water installation. Between 6 and 11 October, the flight management, parking, fence, etc.; inspection center of CAAC conducted an inspec- (f) environmental management plan; (g) land action for navigation equipment and flight proce- quisition and rehabilitation; (h) auxiliary facility; (i) dures. During the testing flight, the control tower service vehicles; and (j) storm water reuse system equipment was fully tested, as well as the runway and ground aircraft auxiliary power unit. and lighting system. The testing result met the CAAC’s standard and regulation. It is planned that

the trial flight will be conducted in Dec 2016, fol- velop airport operation model for SSAC and com- lowed with the overall acceptance from the CAAC. pliance with regulations and international practices. Airport Operational Arrangement: The operational arrangement for the airport has now been final- The Shangrao PMO plans to organize a workshop ized, and the Jiangxi Airport Group, which is a sub in Beijing/Shangrao on the topic of the experienc- -company of the Beijing Capital Airport Group, has es and lessons learnt during the design and con- signed an operating concession agreement with struction of Green Airport in the summer of 2017 the Shangrao Municipality to operate the Shangrao and another workshop in the summer of 2018 on airport. Jiangxi Airport Group established a sub- the topic of the experiences and lessons learnt company in Dec 2015, Shangrao Airport Operation during the operation of Green Airport. The study Company, to take over the operations of Shangrao on the Shangrao Green Airport experiences and airport once the overall acceptance is completed. lesson learnt summary: planning, design, construc- Currently there are about 60 employees hired for tion and operation will be carried out soon. A new Shangrao Airport Operation Company, and they study on the Shangrao Airport operational manual are taking relevant trainings in the Shangrao air- review and optimization is newly added under the port. In addition to operating the airport, the Jiang- TA component as to assist the Jiangxi Airport xi Airport Group will assist Shangrao municipal Group to customize the standard operational man- government and the PMO to obtain the necessary ual to the Shangrao city circumstances, in terms of approval and clearance from the civil aviation ad- saving energy, improving efficiency, tourism devel- ministration authorities before the airport is ready opment, local transport plan, and etc. for operation. The project is well on track to achieve its PDO. Airline Service Agreement: The Shangrao Munici- With the construction largely completed, the focus pality paid much effort on the establishment of airof the project supervision has turned to operation lines connecting Shangrao with other major cities arrangement, obtaining the green building certifi- in China. The regional bureaus of the Civil Aviation cate, and sharing of green airport design experi- Administration of China (CAAC) have been con- ence more widely. tacted, and the major airline companies have been communicated. To date, Shangrao Municipality Contact person is Weimin Zhou at has signed strategic cooperation agreements with [email protected] the Sichuan Airline and the China United Airline, to create airlines connecting to Chengdu, Chongqing, Beijing and Foshan. The official service contracts PACIFIC AVIATION INVESTMENT will be signed after the final acceptance of the PROGRAM Shangrao Airport. At the same time, the PMO plans to contact the Shenzhen Airline in the near In December 2011 IDA approved the Pacific Avia- future to secure the connection to Shenzhen, be- tion Investment Program (PAIP), a series of pro- cause there are already many existing travel de- jects designed to ensure that critical aviation infra- mands between Shangrao and Shenzhen due to structure meets operational safety requirements, the economic activities between two cities. as well as to measures to strengthen regulatory compliance of international air transport of the par- Component 2: The second project component fi- ticipating Pacific Island Countries. Major elements nances consultancy services, studies and training, of the US$220 million program focus on the up- including advisory services to support the Project grading of and maintenance of critical airport infra- Management Office (PMO) and Shangrao San- structure, including runway and apron rehabilita- qingshan Airport Company Limited (SSAC) on pro- tions, improvements to airport terminals, aeronau- ject coordination and monitoring activities. Other tical equipment (navigation aids, runway lighting), activities will include consultancy services to de-

fire and rescue equipment, as well as technical airport to improve the safety of operations; (ii) de- assistance with strengthening of policy and regula- velopment of a Kiribati Transport Sector Plan, and tory capacity through master planning, reviewing completion of an Air Service Agreement Study; (iii) air services agreements and developing aviation completion of a Training Needs Analysis with sector strategies. budget available to the State for implementation. Navigational aids and communications equipment Phase I of PAIP includes projects in Kiribati, Ton- to be installed at CXI and TRW airports, and con- ga and Tuvalu. Samoa entered the program in tracts for the VSAT design, supply and installation April 2014 as Phase 2, and IDA has since ap- were procured as a regional good. Also completed proved Phase 3 with Vanuatu in March 2015. Solo- is the assessment and specifications of rescue fire mon Islands remains an eligible entrant to the IDA service vehicles; upgrading of the airfield rescue regional program. IDA also approved a Pacific Avi- and fire-fighting compliance category will be ation Safety Office Reform Project in September achieved after a regional procurement for vehicles 2013 in support of the regional entity’s regulatory is tendered. An ADS-B Implementation Coordina- advisory mandates. tor is supporting equipment and equipage needs, in preparation of a regional rollout of ADS-B, to be The Pacific Region Infrastructure Facility (PRIF), a procured as a regional activity. An increased use multi-donor trust fund, has supported PAIP with of PASO services has been facilitated through resources to enable the continuation of on-going PRIF. Additional Financing (IDA Grant) is currently regional aviation safety and security oversight in under preparation to meet funding shortfalls on the participating States during a restructuring and tran- original project and to improve coastal protection. sition of the Pacific Aviation Safety Office (PASO) through the IDA-financed PASO Reform Project. Contact person is Pierre Graftieaux at The funding allows grant recipients to purchase [email protected] and Nora Weisskopf at regulatory oversight advisory services in fulfilling nweisskopf @worldbank.org safety inspection requirements for international aviation, while also supporting their obligations as a signatory to the Pacific Islands Civil Aviation SAMOA Safety and Security Treaty. Samoa Aviation Investment Program

(P143408) Program contact person is Christopher Bennett at [email protected] Subsequent to an initial IDA Grant of US$25.0 million, the World Bank approved in June 2016 Addi- tional Financing (IDA Credit US$16.62 million KIRIBATI equivalent), to scale up apron pavement expan- Kiribati Aviation Investment Program sions and fuel hydrant extensions necessary to (P128938) integrate a new terminal building currently under construction. The project is completing the second With an original IDA Grant commitment of year of implementation and is making reasonable US$22.91 million, the project is entering its fourth progress towards the development objectives. year in implementation. The AU$5 Safety and Se- curity Levy on departing international passengers The AU$5 Safety and Security Levy was activated has been successfully implemented and is being in late 2015, representing a major policy achieve- collected, which represents a major policy ment that will enable increased fiscal resources achievement that will result in increased fiscal re- towards safe and secure air transport. Contract sources towards safer and more secure air award for upgrading the capability of the airfield transport operations. Progress to date includes: (i) rescue and fire-fighting compliance category to construction of the security fence around Bonriki meet Category 9 outcomes is awarded, with deliv-

ery of the additional vehicle expected in 2018. a’amotu; and (iii) a Training Needs Analysis with budget available to the State for implementation. Modernization of air traffic communications is also Navigational aids and communications contract is underway and includes the installation and opera- in place and the supply and installation is currently tion of VSAT and ADS-B technologies. Other activ- ongoing. The contracts for the VSAT design, sup- ities include bidding of the civil works tender for ply and installation are also in place and procured airfield pavements, acquisition and installation of as a regional good. navigation aids, airfield ground lighting, air traffic control equipment and power generation. The terminal renovation for Fua’amotu Internation- al airport and the tanktainer to support refueling Key technical assistance activities also include an operations in Vava’u for regional flights have start- Air Transport Sector Strategy and an Airport De- ed in 2016. Also completed is the assessment and velopment Plan and Business Strategy for Samoa specifications of rescue fire service vehicles; up- Airport Authority (SAA). An ADS-B Implementation grading of the airfield rescue and fire-fighting com- Coordinator is supporting equipment and equipage pliance category will be achieved after a regional needs, in preparation of a regional rollout of ADS- procurement for vehicles is tendered. An ADS-B B, to be procured as a regional activity. Support for Implementation Coordinator is supporting equip- development of a Personnel Licensing System has ment and equipage needs, in preparation of a re- been provided to the Civil Aviation Division (CAD). gional rollout of ADS-B, to be procured as a re- A Training Needs Analysis for both SAA and CAD gional activity. Ministry of Infrastructure and Tour- has also been completed. An increased use of ism has contracted an Aviation Advisor to support PASO services has been facilitated through PRIF. with regulatory and policy guidance.

Contact person is Christopher De Serio at A Regional study to develop the PASO Business [email protected] Development Plan and organizational restructure has been completed, financed by PRIF, and an increased use of PASO services has been facilitat- TONGA ed through the allocated PRIF budget. The regional Tonga Aviation Investment Program study on the Flight Information Region and Upper (P128939) Airspace management, financed by PRIF, has been completed. An increased use of PASO services has With an original IDA Grant contribution of been facilitated through PRIF. US$27.21 million, the project is in the fifth year of implementation schedule. The AU$5 Safety and Contact person is Julie Babinard at Security Levy on departing international passen- [email protected] and Pierre Graftieaux at gers has been successfully implemented and is [email protected]. being collected, which represents a major policy achievement that will result in increased fiscal resources towards safer and more secure air TUVALU transport operations. Upgrading and rehabilitation Tuvalu Aviation Investment Program of runway pavements at both the Fua’amotu Inter- (P128940) national Airport (TBU) and the Vava’u International Airport (VAV) have been completed in 2016. With an IDA Grant contributions of US$11.85 million, US$6.06 million and US$2.89 million, the pro- Several other key activities have been completed: ject is in the fifth year of implementation, with a (i) terminal upgrade, and commissioning of requi- revised closing date of June 2018. The AU$5 site security equipment on site at Vava’u to sup- Safety and Security Levy on departing internation- port regional operations; (ii) fencing repairs at Fu- al passengers has been successfully implemented

and is being collected, which represents a major oversight. policy achievement that will result in increased fiscal resources towards safer and more secure air Contact person is Christopher De Serio at transport operations. [email protected]

Further, Tuvalu has taken the necessary institutional steps for restructuring government depart- ments with the separation of regulatory oversight from airport management within the Ministry of Communications and Transport.

Key activities include: (i) the civil works to resur- face the Funafuti runway and Funafuti roads; (ii) the construction of a new terminal is under way and expected to be completed early 2017; (iii) installation of navigation aids under way; (iv) procurement of ADS-B completed and expected to be operational early 2017; (v) procurement of refurbished rescue fire vehicle completed with vehicle to be mobilized early 2017; (vi) obstacle limitation survey completed; (vii) wildlife management plan prepared; and, (viii) procurement of fire station and flight services center commenced. Increased support from PASO has helped with compliance and

VANUATU technical assistance activities include the Airport Vanuatu Aviation Investment Program Masterplan and the Aviation Sector Strategy. The (P154149) project has mobilized an advisor to the CAAV to strengthen regulatory oversight. The process to intro- The project is in the second year of implementation, duce the AU$5 safety and security levy is under way. having been prepared as an emergency operation, The design of the rehabilitation of Bauerfield is com- with an original IDA Credit contribution of US$59.5 pleted, and a National Project Manager is under re- million. Additional finance is currently being prepared cruitment. PRIF funds have been made available to for US$14.1 million. Completed activities include the the state in order to facilitate the use of PASO ser- pavement coring and deflection testing, as well as vices. temporary remedial works to the runway realized in order to ensure safe operations at Bauerfield interna- Contact person is Christopher Bennett at cben- tional airport, in Port Vila. A desktop review has been [email protected] and Christopher De Serio at completed to confirm the relevancy of the project in- [email protected] vestments for future aircraft operating types. Procure- ment of two airfield rescue and firefighting (ARFF) vehicles is awarded which will lead to upgrading the capability of the ARFF compliance to achieve Airport Category 8. Procurement of ADS-B ground stations for aircraft surveillance was also completed and equipment will be delivered in early 2017. Additional

PACIFIC ISLANDS of oversight work programs, and ultimately benefit Pacific Aviation Safety Office (PASO) passengers by increasing the integrity of the avia- Reform Project (P145057) tion system in the Pacific region.

Complementary to major capital investments under-  An aviation legal expert is making recommenda- taken through PAIP, the World Bank approved a tions on amending the Pacific Islands Civil Avia- US$2.15 million Regional IDA Grant in November tion Safety and Security Treaty (PICASST), and 2013 to support the implementation of new business the PASO Constitution to improve State account- planning and processes at the Pacific Aviation Safety abilities and commitment. Further, an institutional Office (PASO). Established in 2004 through the Pa- specialist familiar with executive management cific Island Civil Aviation Safety and Security Treaty, and the aviation industry is developing recom- PASO supplements highly specialized expertise in mendations that support a new governance aviation regulatory oversight to ten Pacific Island framework, which shall include a blueprint for im- Countries. However, the financial viability of the or- plementation of the agreed recommendations. ganization has been elusive. By strengthening Together, the aviation legal advisor and the insti- PASO's technical and coordination capacity, the pro- tutional specialist are reviewing and providing ad- ject aims to ensure effective delivery of aviation safe- vice on governance and management aspects of ty and security oversight, and advisory services to the organization. PASO Member States.  The Employment Policy and Procedures Manual The project is focused around three components, has been amended to update and improve as- namely: (i) transitional management and support for pects of PASO’s human resource management PASO, comprising technical assistance activities that practices (including performance management, facilitate implementation of its newly adopted busi- and remuneration reviews), Health & Safety, and ness plan; (ii) the establishment of a pool of regional corporate ethics and confidentiality agreements, aviation experts available to PASO member states to as well as appropriate use of IT systems that sup- advise on aviation safety and security regulatory mat- port recognized good practice in these areas. ters; and (iii) the establishment of appropriate quality Further, the Financial Management Manual and assurance and information management systems. related policies have been reviewed and updated. Development and refinement of technical regula- Transitional arrangements to strengthen PASO’s fi- tory inspectorate manuals, including those for nancial viability and effectiveness are underway: Certification and Approvals, Compliance Audit and Surveillance, Accident and Incident Manage-  The regional pool of inspectors with appropriate ment, and Security are expected to be available credentials has been identified and continues to in early 2017 to reflect industry standards and offer available qualified personnel as may be re- align with NZ civil aviation regulations in accord- quired by Member States. ance with PASO’s mandate.

 A core activity, the Financial Management and Contact person is Christopher De Serio at Sustainability Analysis, is well advanced with pro- [email protected] posed alternatives under consultation with stake- holder States. Options are under review to move away from PASO’s current funding structure towards a possible tiered regional safety and security levy on international passengers. The levy would then facilitate improved aviation safety and security, as PASO could more efficiently schedule inspectorate personnel, permit the full completion

BOLIVIA The new 1,500 meter runway has been inaugurat- National Roads and Airport Infrastructure ed on 15 November 2016 by president Evo Mo- Project (P122007) rales. Works were executed with a direct financing of the Department’s Government. AASANA is The Bolivia National Roads and Airport Infrastruc- probably going to announce the execution of the ture Project supports road infrastructure improve- next 500 meters of runway with the same source ment in the department of La Paz and the upgrad- of financing, for a 2,000 meter runway. ing of airport infrastructure and equipment in the town of Rurrenabaque in the department of Beni. Contact person is Gylfi Palsson at [email protected].

GRENADA Regional Disaster Vulnerability Reduction APL1 (P117871)

Grenada’s Maurice Bishop International Airport (MBIA) functions as an important regional infrastructure site in the region’s emergency response capacity. It is the alternate airport for Trinidad and Tobago, Barbados, and St. Vincent and the Grena- The investment is being used for the construction dines, and provides air traffic support in emergen- of a new taxiway, apron, control tower, operations cy situations to the island of Saint Vincent. The building, rescue and firefighting buildings, an ac- continued operation of the airport is therefore criti- cess road, and a passenger terminal; and the ac- cal to the region as well as to Grenada. Under the quisition and installation of aviation control, rescue Regional Disaster Vulnerability Reduction Project, and firefighting equipment. critical investments will be financed at the airport in order to comply with emergency response capa- The actual state of the bidding process and pro- bility operational standards, as required by the In- curement for future works is the following: ternational Civil Aviation Organization (ICAO). In the absence of these investments, Grenada and  Fire truck: The Bank has recently given the No the region risk a downgrading of its airport certifi- Objection for purchasing the fire truck for the cation. airport; purchase process negotiations are under way. Contact person is Tiguist Fisseha at  Supervision: With the short list for Expressions [email protected]. of Interest, AASANA is finalizing the RFP & TOR documents for our approval.  Civil Works: The Bank has given the No Objec- tion to AASANA’S evaluation report for the execution of Civil Works.  Equipment: We will shortly start the procurement process for equipment purchase and installation.

The new deadline of the project’s Bank financing is July 2018.

EGYPT Thus, Egypt has embarked on the gradual liberaliza- Cairo Airport Development Project – TB2 tion of international air services on a bilateral basis (P101201) with several countries in the Middle East, Africa, and Europe. It has also significantly improved airport ser- Air transport is highly strategic for Egypt’s economic vices through a range of capacity investments and development because it creates significant employ- the strengthening of airport operations. ment and supports the country’s tourism sector. In FY09, tourism accounted for 3.5% of Egypt’s GDP Egypt needs to continue expanding airport infrastruc- and generated US$10.5 billion in revenue and 12.4 ture and improve airport services to meet growing million visitors. Around 80% of tourists came through demand, especially at Cairo International Airport, the Egypt’s airports, and tourists represented half of the main gateway to Egypt. It also needs to continue international passenger traffic at Cairo International strengthening air traffic control infrastructure and air Airport. traffic management.

About twenty years ago, the Government of Egypt The Cairo Airport Development Project-TB2, ap- realized the growing importance of air transport as a proved in 2010 for an amount of US$280 million, is driver of growth in its own right. The Government’s primarily supporting the rehabilitation and expansion objective therefore became to ensure that the liberali- of the Terminal Building 2 (TB2) at Cairo International zation of air transport would contribute positively to Airport, with a focus on enhancing the capacity and the development of the Egyptian aviation sector. the quality of services of the airport (component 1 of

the project). The component 2 consists of five studies YEMEN of technical assistance on various topics. Port Cities Development II Project (P088435) The project’s objectives are to (i) enhance the capacity and the quality of services of the Cairo Internation- The primary development objective of the PCDP II al Airport, and (ii) improve the capacity of key stake- project is to improve the capacity of key transport in- holders (Ministry of Civil Aviation and the Egyptian frastructure in the port cities of Mukalla and Hodei- Holding Company for Airports and Air Navigation) in dah. The aviation component seeks to gain time sav- the strategic planning of the air transport sector. ings for passengers landing and departing at Mukalla the strategic planning of the air transport sector. International Airport.

The project’s beneficiaries will be: (i) business and The project closed on 30 June 2015. However, due tourism passengers, who will benefit from better to the IDA disbursement suspension on 11 March airport infrastructure and services, (ii) businesses, 2015, the expansion of the Mukalla International Air- which will benefit from extended air transport ser- port was only completed at 85%, and the airport re- vices and a more attractive area around Cairo Air- mains closed due to the ongoing conflict in Yemen. port International, and (iii) workers, who will benefit from job creation through the construction phase Contact person is Sabine Beddies at as well as after construction, through airport activi- [email protected]. ties as well as activities of industries and services in the area of Cairo International Airport.

As of now, the project has completed the construction and testing of TB2. On 28 September 2016, the airport operated two airlines in a soft opening. By the end of November, the official opening is expected to occur with all airlines operating. Munich Airport has been selected to be the terminal operator for TB2 and the interfaces with TB3.

Five studies to support the air transport development objectives of the project have been completed, including a safety and security audit. A com- mittee has been established to monitor and evalu- ate the implementation of the recommendations of the five studies.

Contact person is Olivier Le Ber at [email protected].

Guatemala ment (not responding to civilian radars) over the territory of Guatemala. The mission met with the A World Bank mission travelled to Guatemala on Ministry of Defense and discussed the procure- 03-14 August 2015. The mission responded to a ment and planned integration of the radars. The request of the Minister of Finance and the Presi- mission concluded that the major shortfall of the dent of Guatemala to support reforms at the cus- procured radar systems was the fact that the ra- toms systems and tax collection agency, including dars were be stand-alone systems with no opera- operations at ports and airports in Guatemala. The tional integration. In its technical report, the mis- objective of the mission was to focus on operation- sion proposed concrete technical measures as to al and procedural issues of customs and passen- how to integrate the three radars systems into a ger handling, infrastructure and airport access is- civilian air traffic control system, which was partly sues, as well as on current operations of the air- implemented later that year. This is a positive out- port. In addition, it has been considering the regu- come, as the current air traffic surveillance system latory oversight of the air transport sector by the was not performing well, and additional radar sys- authorities, as well as the current stage of the air- tems do enhance accuracy. port infrastructure and operations at La Aurora In- ternational Airport in Guatemala City. Contact person is Charles Schlumberger at [email protected] Major findings and activities for the Airport Sector include (i) customs procedure for private and scheduled flights; (ii) airport operations (including Haiti infrastructure, rescue and firefighting); and (iii) Civil Aviation Authority and airport commercializa- An Advanced Air Operator Assessment for Haiti tion, where the WB will to continue the dialogue in and the Dominican Republic for WB Staff travel view of a commercialization of the airport opera- safety has been performed on 01-12 February tions by Private Public Partnership. 2016. The objective of the mission was to review, assess, and certify at least one local operator for The main objective was to inquire how to improve regular or chartered flights out of Port-au-Prince to operations, and to stop the losses generated in the be a "no objection, cat. 3a" operator in the WBG current setup. While some operations could be im- Airline Advisory System and to review and assess proved by strengthening airport management, the a few on demand operators in Haiti and the Do- creation of the airport company remains the im- minican Republic, which could be pre-cleared by portant next step to advance this matter. the Bank's "Advanced Operator Assessment".

During a second mission to Guatemala from 01 - The outcome of the review was that one airline in 12 February 2016, the WB provided technical as- Haiti was approved under certain conditions, as sistance to the Government of Guatemala to re- well as one helicopter ambulance service. In the view the procurement of air traffic control radars. Dominican Republic, one medevac operator was The General Audit Unit of Guatemala is currently approved unconditionally, while another local op- reviewing the procurement process for three ra- erator and an airline in Turks and Caicos were not dars, and asked the WB for technical assistance. approved for on demand operations.

Preliminary findings led to the conclusion that the Contact person is Charles Schlumberger at acquired equipment primarily serves to detect illicit [email protected] flights or aircraft that have malfunctioning equip-

Senegal

In Dakar, Senegal, an air transport mission performed an analysis of the national carrier Senegal Airlines from 13-23 October 2015. The objective was to discuss with the Government of Senegal options for the way forward of the air transport sector, given that the airline experienced significant losses and a declining passenger numbers.

The mission elaborated on some of the causes for the difficulties the carrier experienced, and highlighted the fact that a small private local operator was slowly developing and replacing some of the destinations the former carrier could not serve anymore. The WB highlighted the importance of supporting such private sector initiatives, and suggested that IFC ex- amined possible investments.

Contact person is Charles Schlumberger at [email protected]

Pakistan

A World Bank mission traveled to Islamabad, Paki- stan, from 21 August to 02 September 2015. In Is- lamabad, the World Bank participated in the mission on PSE Reform and Private Sector Development.

The objective was to engage with the Privatization Commission (PC) and the relevant stakeholders at a technical level and to provide support on the aviation sector and on Pakistan International Airlines (PIA), and to discuss the modalities of the Investor Road Show on power sector companies, which may include a session on air transport and was scheduled to take place in the United Stated in October 2015.

The mission reviewed and discussed with the PC, management of PIA, and the consultants the findings in technical, financial, and legal reports.

Contact person is Charles Schlumberger at [email protected]

projects. companies andhas traditionally financed air carriers and airport infrastructure Air IFC Projects: Transport

The IFC provides financing to private sector sector private to financing IFC provides The

IFC PROJECTS

IFC’S EXPOSURE (as PROJECT COUNTRY DESCRIPTION AMOUNT (USD) of End-of-FY2016) TYPE CODE USD*

Africa (Mali, Burkina AKFED Aviation: General purpose loan to 27048 $25 million $9.4 million A Loan Faso, Uganda) a regional alliance of African Airlines

Cambodia Airports: Privatization of Cambodia 21363 $10 million Project Closed A Loan Phnom Penh International Airport

Cambodia Airports II: Privatization of IFC A Loan up to Phnom Penh International Airport– re- $7.5 million, IFC Cambodia 25332 Up to $17.5 million $2.0 million quired capital and investments for expan- standby up to sion $10 million

IAS: Acquisition of up to 3 secondhand Dauphin N3 helicopters to provide Cote D'Ivoire 32061 $7 million $1.9 million A Loan transport services to leading oil and gas exploration and production companies

Dominican Republic 27883 Punta Cana Airport: Capacity expansion $20 million Project Closed A Loan IFC PROJECTS

IFC’S EXPOSURE (as PROJECT COUNTRY DESCRIPTION AMOUNT (USD) of End-of-FY2016) TYPE CODE USD*

Montego Bay Airport: Operation and expansion of Sangster International Airport; A and B Loans improvement of the existing terminal and $20 million (11353) Project closed (11353) the construction of a new concourse (11353) MBJ Phase 1 Swap: The proposed project Client Risk Man- is to provide a USD interest rate swap to agement – Inter- hedge the interest rate volatility inherent $1.2 million (24676) $0.6 million (24676) mediation in the floating rate IFC Phase 1 loans (24676) (24676)

11353, 24676, MBJ Phase II - Expansion and redevelop- $42 million; $20 million A and B loans Jamaica 24306, 26202, ment of Sangster International Airport for IFC’s own account $10.3 million (24306) (24306) 31658 (24306) (24306)

MBJ (CUTE): Financing for new Common Use Terminal Equipment (CUTE) and Bag- gage Handling and Screening (BHS) sys- $5 million (26202) Project closed A Loan (26202) tems for Sangster Int'l Airport. Project closed on 06/12/2013 (26202)

MBJ ROS: The proposed project consists of the runway overlay of Sangster Inter- A and B loans $7.5 million (31658) $6.0 million (31658) national Airport (SIA) and other safety (31658) investments (31658) IFC PROJECTS

IFC’S EXPOSURE (as PROJECT COUNTRY DESCRIPTION AMOUNT (USD) of End-of-FY2016) TYPE CODE USD*

IFC A Loan $80 million and Syn- dicated B loan $175 million Queen Alia International Airport: Rehabil- $295 million; $120 mil- 26182, 26864, $109.8 million, $16.9 mil- (26182) Jordan itation of both airside and landside facili- lion for IFC’s own ac- 26685 lion, $17.4 million ties count IFC C $40 million Cross Currency Swaps (26864, 26685)

KQ Airways: Expansion program consisting of the acquisition of 9 Boeing 787 Kenya 31650 $25 million $6.3 million Equity Dreamliner aircrafts and 10 Embraer 190 aircrafts

Buddha Air: Purchase of small aircraft and long term working capital requirements $10 million, $6.9 mil- Nepal 27247, 31446 Project Closed IFC A loan lion Buddha Air II: Financing to BAPL (Buddha Air Private Limited) to purchase its second ATR-72 aircraft. Investment fully re- paid

Lima Airports Partnership: Financial re- Peru 24489 structuring and assistance in conjunction $20 million $16.8 million Equity with Fraport IFC PROJECTS

IFC’S EXPOSURE (as PROJECT COUNTRY DESCRIPTION AMOUNT (USD) of End-of-FY2016) TYPE CODE USD*

$236 million; $101.3 Pulkovo Airport: Financing to expand, Russian Federation 28218 million for IFC’s own $72.7 million A & B Loans develop, operate and maintain airport account

TAV Tunisia: Construction of a new air- IFC A Loan, Sub- $253 million; $184 mil- port in Enfidha, with an initial capacity of ordinated Loan, Tunisia 26913, 28076 lion for IFC’s own ac- $106.6 million (26913) 7 million passengers per year, and reha- Syndicated B count bilitation of the airport in Monastir Loan, Equity

ASECNA: Financing to enhance member Africa Region 32546 countries’ airport facilities and to rein- $36.03 million $30.7 million A Loan force air traffic security in the region.

Queen Alia II: Stage 2 of expansion and rehabilitation of QAIA consisting of de- $93.8 million; $21.2 IFC A Loan, Syn- Jordan 34536 molishing of the old terminals and an million for IFC’s own $21.2 million dicated B Loan extension of the piers with additional account and Parallel Loan contact gates

Zagreb Airport: Construction and opera- A Loan, Equity, tion of a new passenger terminal and $72.65 million for IFC’s $60.9 million (31969) and C Loan related infrastructure at Zagreb Airport own account (31969) (31969) Croatia 31969, 34380, and the existing facilities.

$1.2 million for IFC’s Client Risk Man- Zagreb Air Hedge: Interest Rate Swap $6.7 million (34380) own account (34380) agement (34380)

AFRICA: AKFED Aviation (27048) SUB-SAHARAN AFRICA: ASECNA (32546)

The Aga Khan Fund for Economic Development The Agence pour la Securite de la Navigation Aer- (“AKFED”), through its Aviation Services division, ienne en Afrique et a Madagascar (ASECNA) is a is currently expanding its activities in both East multi-state governmental agency. It was created in and West Africa. The aim of the division is to as- 1959 and is composed of 18 member countries sist in maintaining the critical aviation infrastruc- (Benin, Guinea Bissau, Burkina Faso, Cameroon, ture in support of economic development and to Central African Republic, Chad, Comoros, Congo, provide much needed regional airline services in Cote d’Ivoire, Equatorial Guinea, France, Gabon, Africa. IFC’s involvement with the organization in- Madagascar, Mali, Mauritania, Niger, Senegal, cludes a corporate loan of up to US$25 million to and Togo). AKFED for on-lending to its three airlines: Air Burkina, Air Mali and Air Uganda. This allows ASECNA is responsible for the design, implemen- AKFED to consolidate all of the division’s airlines tation and management of facilities and services and aviation activities and optimize routing, syner- related to the transmission of messages and traffic gies and overall effectiveness across the group’s information, guiding aircrafts, air traffic control, airline operations. forecasting and reporting meteorological information, for traffic route, approach and landing at Loan proceeds will be used to fund fleet acquisi- airports in African members countries. It is also in tion cost (introduction of nine refurbished MD-87 charge of the maintenance of all facilities required and two MD-83 aircraft) and other airline develop- for the implementation of these services, including ment costs including training of crews and engi- the management of an airspace covering 16 mil- neers, purchase of spare parts, and improving lion square km, with a total of 32 airports. maintenance facilities. IFC investment consist of an A loan of USD$36.03 The project is expected to promote inter-regional million aimed at financing a list of specific infra- and international trade in the region. Additionally, structure refurbishment including purchase and the project is also expected to provide a boost to installation of back-up power equipment in a num- tourism. Continued trade and economic growth in ber of member countries in Africa. The loan is de- Africa is contingent on further investments and im- signed to promote regional and integration and provements in regional transport infrastructure and improve air space management facilities, infra- services. The division’s operation will fill the ser- structure, and communications thus enhancing vice gap that exists today and will result in in- member countries’ safety in the air transportation creased frequencies for existing destinations as sector. well as the addition of new destinations, better passenger service and improved efficiency and safety. Such improvements will increase the con- COTE D’IVOIRE: International Aircraft nectivity, competitiveness and attractiveness of these countries’ economies. Moreover, the project Services (32061) will support regional integration by assisting the development and expansion of a group of regional The project, which was approved in March 2013, airlines. provides financing of US$7 million to International Aircraft Services (IAS) for the acquisition of up to

three secondhand Dauphin N3 helicopters by IAS. company in a post-conflict country to pave the way The helicopters will be used to provide transport for more investments in the future. services to leading oil and gas exploration and production companies in Cote d’Ivoire and the Western African region. The project will enable CROATIA: Zagreb International Airport IAS to modernize its fleet with newer helicopters to (31969) meet its client needs. The IFC is supporting the development of a termi- IAS is an aviation operator and maintenance com- nal at Zagreb International Airport as part of a pany created in 2002 and registered with the Ivory Public Private Partnership (PPP). The new Coast Civil Aviation Authority. It provides mostly US$450 million terminal, built by a consortium helicopter transport services to the oil and gas in- supported by IFC, is expected to contribute to eco- dustry in Cote d’Ivoire and to the mining industry nomic growth and tourist activity. Tourism is a main West Africa. The company currently owns 13 jor driver of employment in Croatia, and improved helicopters and employs 25 pilots. IAS is based in infrastructure will develop the sector and boost Felix Houphouet-Boigny International Airport, GDP. IFC is committing US$72.65 million to the which is approximately 16 km South-East of Abid- project, including a loan of up to US$47 million jan. and an equity investment of nearly US$26 million. The concession includes financing, design, and The expected development impact will be develop- construction of the terminal, along with airport op- ing local know-how, and support the development eration until 2042. of exploration and production of natural gas activities by providing reasonably priced transportation The new terminal will be 65,000 square meters services. The project also hopes to create a and is expected to welcome 5 million travelers per demonstration effect by providing financing to a year when it opens in 2017, compared to the cur-

rent capacity of 2 million. An average of 400 new opening of new intra-Africa destinations will con- jobs are expected to be created during construc- tribute to markets integration and will reduce the tion, and up to 700 at peak. For the first time in transactional costs of trade, an aspect that is ex- Croatia private firms involved in a transport con- tremely important to promote the economic devel- cession project have assumed passenger volume opment of the SSA economies. risks, enabling the country to upgrade essential infrastructure without adding a burden to state fi- KQ's entry into new international markets will also nances. promote competition as well as provide a key transportation link between growing economies in the Middle East and Northern Africa region and KENYA: Kenya Airways Expansion Plan Asia promoting international trade, South-South (31650) Investments and tourism to and from Africa.

NEPAL: Buddha Air II (31446)

Air connectivity is a key requirement in Nepal given its difficult terrain and poor road network. Do- mestic airlines are needed to provide reliable and safe air services. With tourist arrivals in Nepal Kenya Airways Ltd. (KQ) the national flag carrier growing at 12% annually since 2006, and a great- of Kenya and the third largest airline in Sub- er focus on tourism revenues with GDP growing Saharan Africa (in terms of seat capacity offered) approximately at 4.5% p.a., the requirement for is in the midst of implementing a strategic fleet domestic tourist airline seats is expected to grow and network expansion plan. It is focused on even further. growing its passenger network and diversifying its fleet to match the network needs, as well as Buddha Air Private Limited is a closely held pri- launching a dedicated freighter division. Having vate limited company providing air services since reached a critical mass and achieved a solid finan- 1997. BAPL currently has 357 seats across a fleet cial position, KQ finds itself well positioned to capi- of three Beechcraft (18 seats), three ATR-42s (47 talize on the growth prospects and opportunities seats) and two ATR-72 (72 seats). The expansion that the African region and the international mar- to its current fleet had been partially financed by ket present. an IFC corporate loan of US$10 million in FY09. BAPL had a 42% market share by passengers in KQ’s strategic intent is to establish its brand and the first half of 2011, and was the first one to bring its presence in the most important intra-African in larger 45 seater turbo prop aircraft for domestic markets as well as become a significant player in routes in Nepal and also the first to fly to Bhutan long haul origin-destination city pairs that are ex- and to towns across the Indian border. pected to grow over the next few years. To implement the project, the company has placed firm or- The project Buddha Air II addresses two pillars of ders to aircraft manufacturers in connection with CSA strategy; (i) by facilitating passenger and car- the acquisition of nine Boeing 787 Dreamliner air- go transport between India and Nepal it supports craft and ten Embraer 190 aircraft. regional integration; (ii) by enhancing transport and access across Nepal at reasonable cost, it IFC's support of Kenya Airways expansion plan is supports inclusion in Nepal. The project also fits expected to have significant development impact. well with the FY11-13 WBG ISN which highlights At the regional level of Sub Saharan Africa, the connectivity and private sector growth. launch of the freighter division coupled with the

IFC has been providing financing of US$6.9 million to BAPL for acquisition of a second ATR-72 aircraft which BAPL is currently operating on a lease basis, and helped the Company enhance safety standards for the IATA IOSA audit.

Contact persons for all IFC projects is Paula Pardo Pachon at [email protected]

The Infrastructure Advisory Services Department 2) IFC Public-Private Partnerships (PPP) Advi- of the IFC provides advisory assistance to govern- sory Mandates in Airlines ments on structuring and implementing (tendering) Public-Private-Partnerships (PPPs) in infrastruc- As the airline industry has proceeded along this ture. IFC has undertaken more than 100 advisory privatization path over the last 30 years, IFC has transactions in over 67 countries over the last 20 participated in nearly a dozen airline transactions. years. IFC/World Bank's reputation for compe- Unfortunately, many have proved to be difficult tence, transparency, and fairness allows it to play projects due to important sector-specific structural the role of neutral partner to balance each party's reasons: interest, thus reassuring foreign investors, local partners, other creditors, and government authori-  Fixed-cost structure: Airlines tend to build up a ties. The two main domains in air transportation legacy-costs base (staff and fleet) that is diffi- advisory services are private sector participation in cult for a new owner to manage. In addition, airports and air carriers. fuel costs are beyond management’s control. During the period of higher oil price in 2011- 1) IFC Public-Private Partnerships (PPP) Advi- 2014, they accounted for as much as 30% of sory Mandates in Airports the cost base (up from 15-20% in 2009), and have since dropped with declining oil prices Only a fraction of the world’s commercial airports (variations according to individual airline hedg- are managed or owned by private sector entities. ing strategies). However, as passengers carried by air transport  Price-sensitive product: Demand for travel is has neared 3.8 billion in 2016, and more than one- highly elastic, especially in tourist markets. In third in value of all merchandise and goods were recessions, people forgo vacations for other air freighted – Public-Private-Partnerships (PPPs) consumer goods. Conversely, price reductions in airport infrastructure will grow to meet invest- increase passenger numbers dramatically. ment and required service standards. Airport PPPs  Complicated demand chain: Customers often are useful approaches to meet both private and purchase tickets through travel agents, fre- public sector objectives. quently in a package with hotel accommoda- Of the various airport PPP models available, expe- tions. Since airlines rely on these other actors rience shows that concessions and full divestiture for their sales, if there are bottlenecks else- are most effective: where the aviation sector suffers.  Concession Contracts (BOT, BOO, BOOT,  Overregulation: Bilateral agreements between BTO, etc.): State retains ownership of airport governments, still prevalent in many parts of but transfers investment as well as operations the world, prevent competition from functioning and management responsibilities to the private normally. Open skies are being adopted, but sector not in all countries.  Full Divestiture: Ownership, operations, and investment responsibilities are fully transferred 3) IFC Air Transportation Experience to the private sector.  In certain cases, a blend of first-phase BOT When undertaking a transaction advisory man- followed by public offering can maximize bene- date, IFC provides a one-stop solution to govern- fits ments covering all aspects of the proposed transaction. One of the distinguishing features of IFC’s In certain cases, a blend of first-phase BOT fol- value addition is its ability to balance private and lowed by public offering can maximize benefits. public sector interests and take into account sustainable long term economic and social effects.

Selected IFC Advisory Mandates in Airports PROJECT NAME COUNTRY YEAR MANDATE/RESULT

Jeddah Airport Saudi Arabia 2014-ongoing Project on-hold

Taif Airport Saudi Arabia 2014-2016 Due diligence completed

Galeao and Confins Airports success- Brazilian Airports Brazil 2014 fully awarded to Changi and Zurich Airport led consortiums respectively

Saint Lucia Airport Saint Lucia 2013-ongoing On-hold

Successfully awarded to TAV, Saudi Madinah Airport Saudi Arabia 2012 Oger, Al Rajhi consortium Project Due Diligence and Structuring Dili Airport East Timor 2012-2015 finalized

Jamaica Airports Jamaica 2011-ongoing At RFP stage

Successfully awarded to Aéroports de Queen Alia Airport Jordan 2007 Paris, ADIC, J&P, Noor consortium

Successfully awarded to Saudi Bin Hajj Terminal Saudi Arabia 2007 Laden Group, Aéroports de Paris con- Successfully awarded to Abuja Gate- Abuja Airport Nigeria 2006 way consortium (Airport Authority and equity partners) Selected IFC Advisory Mandates in Airlines PROJECT NAME COUNTRY YEAR MANDATE/RESULT

Air Jamaica Jamaica 2009 Awarded to Caribbean Airlines

Drukair Bhutan 2008 Strategic analysis

JAT Yugoslavia 2006 Strategic analysis

Polynesian Airlines Samoa 2005 49% sold to Virgin Blue

Awarded but cancelled by Govern- Cameroon Airlines Cameroon 2005 ment

Air Tanzania Tanzania 2002 49% sold to SAA

Kenya Airways Kenya 1996 76% sold to KLM, financial investors

GALEÃO AND CONFINS AIRPORTS

Building on a previously completed round of con- engineering and construction company, and cessions from 2011, the Brazilian Development Changi Airport Group. The winning bid was Bank (BNDES) approached IFC in mid-2012 to as- US$7.9 billion, and US$ 2 billion will be invested sist with the second round of airport concessions, over the concession term. covering Galeão and Confins airports, in cooperation with Estruturadora Brasileira de Projetos Confins International Airport, is the main com- (EBP). The National Aviation Secretary (SAC) au- mercial airport in the Belo Horizonte region, with a thorized EBP to develop the financial, engineering, population of approximately six million people. and environmental studies necessary for the two The project was structured as a 30-year conces- airport projects. In order to undertake these activi- sion, through which the O&M of assets is trans- ties, EBP and IFC signed a Cooperation Agree- ferred to the concessionaire. The concessionaire ment, with IFC focusing principally on the technical has the responsibility to provide all the necessary work stream. Both projects closed in April 2014. investments, including civil works, to meet growing demand. Confins was awarded to the Aerobrasil Galeão International Airport is located in the consortium, composed by CCR/SA, a large Brazili- southeast region of Brazil; the airport serves as a an engineering and construction company, and major air transportation hub for the country and Flughafen Zurich AG. The winning bid was region. The Galeão project was structured as a 25 US$750 million, and US$1.2 billion will be invested -year concession, through which the operation and over the concession term. management of assets is transferred to the concessionaire. The concessionaire is responsible for Contact persons for all IFC air transport advisory providing all necessary investments, including civil services projects are Ramatou Magagi at works, to meet growing demand. Galeão airport [email protected] and Alexandre Leigh at was awarded to the Aeroportos do Futuro consorti- [email protected] um, composed of Odebrecht, a leading Brazilian

a key economic driver for sustainable eco- sustainable for driver economic key a be will project The Quito. of outside city capital km the 24 Puembo, near a airport of new construction the involves project The Contract. of Breach and Disturbance, Civil and War Restriction, fer Trans- of risks pro- the against guarantee coverage vides Each a years. for 15 are of period guarantees four remaining the while loans, shareholder their for years 14 of period a for coverage have Corporation Development HAS and Group Aecon The en- project terprise. the in investments equity tive respec- investors' the for US$225,000 and US$225,000, US$450,000, of guarantees issued also MIGA addition, In Ecuador. of Quiport Corporacion to loans shareholder respective their for Kingdom United the of Ltd. Management ADC and the States, United of Corporation Development Canada, HAS of the INC. Group Aecon the to lion mil- US$16.4 and million, US$16.4 million, US$32.8 of guarantees three issued MIGA Jorge and include Ecuador. Peru in Airport New in Airport MIGA International Chavez by projects of undertaken examples Two countries. ing and develop- in centers populations rural urban underserved growing rapidly deal to with magnitude) similar (maintenance a year of are a investment needs new billion for US$230 solely for need esti- mated the given MIGA for priority an important is development Infrastructure portfolio. agency’s the of (41%) accounting share largest the for infrastructure in projects (MIGA) with sectors, of range broad Agency a in projects cover Guarantee Multilateral the Investment by provided Guarantees EQUADOR: New Airport at Quito at Airport New EQUADOR:

bond), and extends for eight years. eight for extends and performance bond), the of call wrongful expropria- (the of tion Jorge risk the The against is airport, (JCIA). coverage Airport Lima's International Chavez of privatization the for posted bond performance a to for tee guaran- million counter million US$11.5 US$12.8 its of cover Germany guarantee of a AG with Fraport provided MIGA constraints capacity as well as deficiencies which safety from Quito, suffers of city the the in airport replaces existing airport metropolitan The Quito. the of region of development nomic [email protected] CarloBongianni at Contactperson forall MIGA guarantees is perimeter. airport existing the within center retail and hotel a of creation and taxiways, con- and aprons craft passenger air- new of new addition and expansion course, a of construction terminal, current the to upgrades including infrastructure, new in million US$130 invest over to expected is conces- consortium the the of sion, years four first the During expand and goal. the enhance government key another to also tourism, will gateway to It country's world. facility the as transportation serve modern a create and opportunities, employment ex- to pand efforts its airport to central views as privatization government Peruvian The

PERU: Jorge Chavez International International Chavez Jorge PERU: Airport (JCIA) Airport

Canada. Montreal, University, McGill XL, Air Volume of Law, Space and Annals Vijayakumar, Shruti and berger a Public in responsibilities law. and civil to compared law common ownership of in meaning terms different a has “concession” used term commonly the that is particularity inter- esting One airport. an of divestiture full PPP, to contract management of simple a models from range which different discusses further article The provide. functions to need key governments are that public the com- with transparent munication and supervision, governance, adequate good that arguing by PPP, a ing establish- when diminishes role sector’s the public that notion perceived the countering is article The University. McGill Air of of was Law Space Institute and the airports, of Annals in the in published (PPP) Partnership Private Public a establishing when sector public the of role the on article One 16. FY during progress in were products knowledge analytical Several t

i v PUBLIC PRIVATE PARTN PRIVATE PUBLIC e s

- Private Partnerships in Airports: Imper- Airports: in Partnerships Private f o r

G ANALYTICAL WORK: ANALYTICAL (PPP) IN AIRPORTS IN (PPP) o v e r n m

e n t s

C h a r l e ERSHIPS ERSHIPS s

S c h l u m-

The Bank has maintained an evaluation evaluation an maintained has Bank The 4. 3. 2. 1. Criteria: Risk criteria: on following the based are in ratings/risk Airline launched FY2011. was team Transport Air Department and Services General by Bank’s developed the system advisory The 2008. carrier air since travel mission for travel air with associated risks assessing for tool

1 3 2

that is registered and maintained in a a old years 20 over in aircraft of Use maintained operates) it where and than other country airline registered (an is airline that convenience of flag A over- poor audit) safety with ICAO on (based sight country a in Registered aircraft) substan- the to years or damage tial passenger, a 3 of death in- last or in jury results that the incident any as in (defined accident Serious

reasons. other for unsafe be to deemed are or blacklists, any on are or above, (2) or (1) in not are that airlines All carriers. safe as Bank the to known are or 1, Category li- of rating IASA FAA either an with country a are by censed certified industry not are they though that airlines All ty problem. subsequent safe- a indicates unless experience safety IATA audit, an passed IOSA having by fied certi- industry are that airlines All

WORLD BANK STAFF AIR TRAVEL AIR STAFF BANK WORLD

tial missions and only if no viable and safer safer and viable no if only areavailable. alternatives transport and missions tial the by raised essen- for only Use been specialist. transport air Bank's has that some factor or safety below, listed other criteria risk 4 the of more or 2 and risk elevated significantly with Airlines 3c. travel. mission for airline transport this selecting before alternatives safer and viable any are there if see to Check specialist. transport air Bank's the by raised been has that factor safety other some air or below, listed criteria risk Bank’s 4 the of 1 have that the Airlines 3b. by reviewed fly. to good been considered and specialist transport have but 2, or 1 Category for qualify not do that Airlines 3a. airlines. these ing fly. to Good airlines. these ing fly. to Good eset ad aey die o opera- for staff. tional advice safety and advisory sessments The on provide to countries. continues team client some in travel air than risks more represent may or possible surface be always not that may aware transportation be should Travelers the in regions. arranged trips capture not does ta da- This Note: fly”. to “Good be to sidered i 14% than 2015. Year Fiscal more to compared by traveling in increase an representing HQ), (from 2016 Year cal Fis- in staff Bank for Express American by booked flights 194,434 were there Overall t y

o f

f l i g h

t The Bank has no objection to us- to objection no has Bank The us- to objection no has Bank The s

o o k e d

w e

r e

w i t

- a demand as- demand i The major- The r l i n e s

c o n-

om ad aiiain f rvt invest- private of ments. facilitation re- and regulatory and forms policy many needed in- Africa), cluding and West (especially land- Africa countries of parts nations, developing island air small locked improving in of priority transport the development, on and focusing finance aviation in role Bank’s the Air highlighted staff WBG ticipation. Bank, par- Lead staff IFC World and Bank Dr. World The included and at by Schlumberger, Specialist led Transport E. was delegation Charles WBG The a is WBG forward. going which partner supporting of Conference, nomics Eco- and Finance Annual ACI’s to prior Lon- don in annually held Symposium, ACI Aviation second the host to forces joined organizations two the 2016, March In (ACI). International Council Airports with part- its nership strengthen to continues WBG The ACI

- WBG ANNUAL AVIATION AVIATION ANNUAL WBG SYMPOSIUM SYMPOSIUM

- WBG WBG

iitos agn fo arot prtr, fi- operators, airport from ranging af- filiations participants’ With facing. is industry the opportunities and challenges, issues, the main of stock take to is industry the transport with air event annual this of objective The the 8th ACI Airport Economics & Finance Finance 2016). & March 9 and (8 Conference Economics Airport ACI and 8th 2016) the March (7 Symposium Aviation ACI 2nd the at during place took that Specialist discussions summarizes It Bank. Aviation World Giovannitti, Aldo post A course the years. upcoming the set for and net- analyses, knowledge, share work, exchange to to together committed sit industry the where occasion unique a again been has Confer- Exhibition & Finance ence & the Economics and Airport ACI Symposium Aviation Bank World ACI the view my in firms, advisory and cies agen- rating regulators, institutions, nancial

- conference report was prepared by by prepared was report conference

- World Bank Bank World

- COOPERATION WITH INTERNATIONAL The WBG and ICAO have been working closely CIVIL AVIATION ORGANIZATION (ICAO) together on various air transport project issues. For example, in the past, ICAO has provided ICAO is the specialized air transport agency of safety and security audits and supervisory ser- the United Nations. The WBG and ICAO have a vices for WBG projects in West and Central Afri- long history of cooperation in the development of ca and the South Pacific. ICAO has also assist- the air transport sector in emerging and developed in identifying needs and priorities of air ing countries. The field of cooperation includes transport projects in a number of other countries. air transport policy, safety and security, facilitation, airport and air traffic control infrastructure, Finally, the WBG continues to foster relations and the environment. with other international partners, such as Re- gional Development Banks (e.g. Inter-American While the WGB cannot directly finance activities Development Bank, African Development Bank of ICAO, it is able to include technical staff of the or Asian Development Bank) or Regional Eco- secretariat on missions and project work. In ad- nomic Communities (e.g. European Union, Afri- dition, the WBG can fund support services by can Union or the Association of Southeast Asian the Technical Cooperation Bureau (TCB) of Nations) to engage in WBG funded air transport ICAO if these are procured in accordance with projects. the credit or grant agreement between the WGB and the client.

6TH MEETING OF THE NORTH AMERICAN, es (SARPs). CENTRAL AMERICAN, AND CARIBBEAN DIRECTORS OF CIVIL AVIATION Training (NACC/DCA/06) The topic of training was widely discussed during the meeting particularly in relation to training ca- The World Bank Group has been represented at pacity, the demand for skilled aviation personnel, the International Civil Aviation Organization and attractiveness of aviation. There was a recog- (ICAO)’s Sixth Meeting of the North American, nized lack of incentives (retention of technical staff Central American and Caribbean Directors of Civil is problematic due to competition with private sec- Aviation (NACC/DCA/06) in Nassau, Bahamas. tor) and a need for more inspectorate training programs. In this context, Regional bodies could pro- The main objective of the mission was to give a vide critical support. Operating RSOOs in the re- presentation on how the WBG can support client gion include the Central American Intergovernmen- countries in the development of air transport. Also tal Corporation/Central American Agency for Avia- have been identified major issues arising from the tion Safety (COCESNA/ACSA), Caribbean Aviation discussions and potential opportunities for WBG Security and Safety Oversight System (CASSOS) engagement in the region. The World Bank was and the Action Programme for Safety (PASO) the only development bank represented at the group. meeting (the organizers had wanted all the banks to participate but this was not possible due to the Environment th short notice). Under Resolution A38-18 from ICAO’s 38 Session Assembly (24 Sept – 4 Oct 2013), states were The areas covered are the following: asked to submit voluntary action plans for reducing CO2 emissions from international aviation. The ac- WBG Engagement tion plans allow states to identify, from a basket of It has been presented how the WBG can support measures, mitigation activities and assistance client countries in air transport development, and needed to implement measures. This basket of highlighted the WBG’s funding mechanisms, pro- measures draw on different ways to mitigate/ ject examples and areas of intervention, and bene- reduce aviation CO2 emission from aircraft related fits of a regional approach (particularly for small technology development, alternative fuels initia- island developing countries). tives, improved air traffic management and infrastructure use, market-based measures (MBMs). ICAO’s No Country Left Behind (NCLB) Initia- One area that was highlighted was the use of solar tive energy at airports e.g. the installation of solar panel A major theme of the meeting was the progress on at airport gates in Jamaica, and further progress in ICAO’s No Country Left Behind (NCLB) initiative this area was encouraged, building on best practic- launched in 2014. The campaign’s main goal is to es. By April 2016, 92 states have submitted an ac- ensure global harmonization of standards so that tion plan globally (representing more than 88% of all states have access to the significant socio- global passenger traffic). economic benefits of a safe and reliable air transport system. However developing countries, in particular, face major challenges towards meeting this goal. As articulated during the sessions, third- party funding from donors such as the WBG can play a key role in supporting states’ compliance with ICAO’s Standards and Recommended Practic-

Several World Bank staff members are licensed One example of an Angel Flight mission, which and active pilots, certified by the US FAA and/or was carried out by Charles E. Schlumberger, Lead European Aviation Authorities EASA. To remain Air Transport Specialist and Christopher de Serio, current on their pilot qualifications, they regularly Transport Specialist at the World Bank, was a fly and undergo required refresher training. The flight to transport an elderly cancer patient from most rewarding way of keeping current is to en- her home in Roanoke, Virginia, to her treatment on gage in community service by providing free air Long Island, New York. transportation to people of all ages whose medical needs – evaluation, diagnosis, and treatment – The WBG’s contribution, in accordance to Staff can only be met by health care facilities far from Manual 9.10, consisted of one day of administra- their homes. tive leave to carry out this rewarding community service. In the US, the not-for-profit organization Angel Flight provides timely travel to patients who cannot Contact person is Charles E. Schlumberger at withstand traveling long distances by automobile, [email protected]. rail, or bus, or who do not have the financial For more information visit: means to use suitable alternative transportation. www.angelflighteast.org. Oftentimes, transport in smaller, private aircraft can better accommodate patients whose conditions could worsen if exposed to the re-circulated air on commercial flights, or who need efficient point-to-point transport.

ing 4.9% billion.ing 3,96to growthThis still signifi-is passengerdeparturesincreas-with 2017 in grow to continues travel air for demand the IATA, to According expected. is growth in slowdown tain cer- a Fiscal that despite for positive, remains transport 2017 Year air for outlook global The PP fr udn o nee ifatutr. On infrastructure. needed of funding for Partnerships (PPP) Private Public created to funding private mobilize should countries rates growth strong Emerging with markets. developed in as infrastructure of quality and standards same the maintain to need countries developed lesser er, Howev- prosperity. shared extremeboosting and poverty ending of goals for WBG the tool addressing important an transportation air countries makes emerging and poor on impact nomic eco- its withindustry the of growth expected The increase 95% since 1995. a representing than 2017, more in reach 18,429 to expected is connections, city unique of number the in tivity,measured in- will connec- Global billion. 123 US$ industryto 5% by crease airline the by generated nues reve- tax Finally, billion. US$681 spend will air by travelling tourists will and trillion, 2017 5.7 US$ in reach air by shipped trade international of value that in- forecasts IATA moderately. to crease started transported freight and recovers trade global as strengthen, to continues opment devel- economic in transportation air of role The in 2017. airlines in Africaanother forecast example, lose to US$800 For sustainable. financially is growth Asia in all remains 7.0% not Nevertheless, Africa. in 4.5% East, and Pacific, travel Middle the air in 9% in strong: growth expected kets, mar- emerging in Especially many. for penditure ex- priority high a remains travel air that fact the topoints which 2.5%,of GDP world abovecantly eln de o eue IR fnnig while financing, IBRD reduced to due decline further to portfolio transport air WBG the in sult re- may This sup- PPPs. of establishment by the porting it be or IFC through sector private the financing directly by it be countries, emerging in sector private the by investments fostering ingly Givenabovethementioned, is increas-the WBG tional standards. to need countries, interna- meets that oversight regulatory maintain emerging and Nevertheless, poor donors. both, by supported is which to establish. They may depend on public funding, difficultare PPPs thatchallenge the face may fic traf- air low withcountries poorer hand, other the

- pair - Carbon Finance unit. off carbon provide will WBG the Furthermore, plans. these of implementation and preparation the for building capacity in tries coun- client support will WBG The plans. action prepareto need statesmeasures, these of tation SchemeInternational for Aviation.For implemen- Market Reduction and a Offsetting Carbon the and Measure, fuels, alternative operations, technology, including measures, of ket ICAO of Assemblybas- a endorsed These resolutions. two adopted 39th the change, climate of challenge the address To gases. greenhouse Aviationremainsstrongestthe growing emitter of tion infrastructure. avia- their modernizing are which States, Island Pacific several on and on countries, African is some focus main the Currently, transport infrastructure. air selective for to investments continue will support WBG the countries, poorer In vices and investment financing privateof entities. ser- advisory on activities its increase may IFC tion. avia- in investments enhance to partners lateral bi- and banks, development regional and tional multina- other with cooperating is WGB the tion, addi- In building. capacity technical and advice policy providing including projects, on partners relevant other and IATA ACI, partner- ICAO, with has ships WBG The objectives. velopment de- set our achieving for essential is it as partners, international and bilateral with as well as industry, transport air the with partnerships tive Finally, continuouslywe will enhance our produc- ings and workshops. dationsbethenwilldiscussedhigh in recommen- policy derived and findings The tor. sec-andtaxes,infrastructurethefees, costofon focus special with analyzed be will countries can Afri- West five ECOWAS, and Bank velopment De- African the with cooperation in Working ca. Afri- in that development transport air hampering issues are and causes the analyze will which WB joint a struggle, to continue airlines that fact the given Africa,and im- transportation in air of portance the Given Africa. air in on development be transport will research, of terms in focus, The

–

AA eerh rjc wl b launched, be will project research IATA

- e sltos y its by solutions set - levelmeet- - Based

Photography Credits:

 Front Cover Aldo Giovannitti/The World Bank - Lupepau’u International Airport, Vava’u, Kingdom of Tonga  Inside Cover, Simone D. McCourtie/World Bank - World Bank Flags, 2009 Annual Meetings Opening Plenary Ses- sion  Page 27, Design of Shangrao Sanqingshan Airport by Grand Wisdom company, http://www.gooood.hk/interior- design-of-shangrao-sanqingshan-airport-by-grand-wisdom.htm  Page 36, Airport inauguration in Bolivia, http://www.laprensa.com.bo/diario/actualidad/economia/20161116/evo- habla-de-%93pequenos-grupos%94-que-perjudican-obras-en-alusion-a-el_82458_144818.html  Page 50, Zagreb Airport  Page 51, Kenya Airway’s Dreamliner, Kenya Airways official website.  All other images belong to WBG or contributors to this report.