The privatisation of airports is still an open debate. In the last 30 years air transport has changed the world. Airports have become the gateway for millions of people. Because of this, airports have also have in many cases become highly profitable investments..
Opponents of privatisation argue that the airport industry is a natural monopoly, and therefore should be run and controlled by the government for the public good. It is not fair that a private entity should be able to profit from an infrastructure that is in the public domain.
Moreover, the calculation of the return on investment by private investors does not take into account the revenue generated by business development in a region. For example, the construction of an airport with public money can eventually create a thriving tourism industry in a region that is currently depressed. Thus, the problem of the private investoris that it can extract the profits made and not reinvest them in the future development of the airport. - and the region
In airport privatisation, the confluence of competing interests on both sides is a real challenge.
Finally, noise and other environmental impacts generated emissions from airports must be part of the deal. For example, the cost of noise pollution is rarely included in the profit and loss account of a private airport. Too often, politicians use public funds to cover the costs of noise pollution - even at private airports. They use them to appease the anger - and sweeten the vote - of neighbouring populations.
Proponents of private airports argue that privatisation eradicates inefficiency and customer-oriented management styles are introduced. State enterprises are notorious for overstaffing and overprotecting staff. The public worker, they add, is unfamiliar with the realities of the market.
Moreover, given that governments are also known for pharaonic constructions at the taxpayer's expense, the overcapacity tends to be the trademark of many public airports. On the other hand, the private investor ensures that only those projects that are economically viable are carried out. This is because they squeeze the maximum capacity out of the infrastructure before adding any new expansion.
Finally, privatisation advocates also argue that public ownership is no guarantee for the democratisation of the industry. Forty years ago, only the rich and famous could afford to fly on the state-owned airlines of the past. Only when deregulation and privatisation came in a competitive market did airline tickets become affordable for all.
The question remains, which is better for the public interest: public or private airports?
Academic studies, which have used complex financial ratios and productivity analysis, are inconclusive. It depends. Also there are many types of privatisation. From the contracting out of only certain services, such as ground handling services, restaurants or car parks, to the sale of all airport facilities, as in the sale of the British Airport Authority under Margaret Thatcher in 1987. There are many other steps in between.
One key factor is true: Value of privatisation depends on competition. Without competition, privatisation will be in vain. But we should not delude ourselves. Airport business is not as monopolistic as it seems. Competition in the airport sector goes beyond regional or national borders. For example, airports in coastal areas in Spain are competing for tourists from airports at the other end of the Mediterranean. Airlines catering to passengers seeking sun and sand operate with the airports that offer them the best proposition. They don't care whether the airport is in Greece, Italy or Spain. They know that many passengers don't either.
I believe that in many cases, the ideal solution is a public/private partnership.. The public partner ensures that the long-term interests of the community are served. The private investor ensures that airport operations are run efficiently and that no public money is wasted on building unnecessary infrastructure.
The confluence of conflicting interests on both sides is a real challenge. I won't say that daily coexistence is an easy task. It is more like a wild roller coaster. But riding the roller coaster, if the seatbelt is fastened properly, can be quite fun.
