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Sunday 13 June 2021
HomeInterviewTunisia: Tunisia TAV CEO explains and denounces organized crimein Monastir

Tunisia: Tunisia TAV CEO explains and denounces organized crimein Monastir

Our article on the ins and outs of the review of the financial conditions of the two concessions of Enfidha and Monastir airports in favor of the Turkish company, under Tunisian law, has created a first reaction from TAV. We wanted to know more about the views of the operator, on its prospects.

In his responses [We have reminded him twice he was not speaking in “off the record”], the CEO, Haluk Bilgi confirms all the financial information that we reported in our article about his business. He points, however, accuses and sends a clear vision, that problems experienced by the airport of Monastir airport are not caused by employees of TAV Tunisia, but represent a situation of “organized crime” spread by the two other holders of the airport’s concession which are DuFry and Newrest by being behind the social movements in the airport of Monastir.

Interview:

AfricanManager: It seems that you, as CEO of TAV Tunisia, have something wrong with our article about the circumstances under which TAV Tunisia has been able to review the material conditions of the two Enfidha and Monastir airport concessions.

Haluk Bilgi: Everything you reported in your article is true. But we were in a case of force majeure and unforeseen events that have made that we could not pay anything. But reading your article, it seems you want us to do so.

If you thought that our newspaper has something against TAV Tunisia, let us say that we did our job as a journalist. Our question now is whether you are confirming the net loss of 48 MTD and what is the situation in terms of revenue and net income for the years 2011 and 2012?

I confirm the loss of 48 MTD in 2010. The Tunisian government, however, is partner in the gain, not in the loss. Losses in 2011 and 2012 are estimated at the same amount, that is to say 48 MTD. Despite these losses, we had to pay all wages, overtime, bonuses and paid all our suppliers and we have not failed to meet any financial commitment to anyone.

How will TAV Tunisia behave with its creditors and financial partners, given the losses that will not stop in 2012, that is, what will you do to honor all your debts?

We will always inject new money.

How?

Each year, we will provide what is needed to balance the scales through TAV International and our two partners AfDB and IFC. This is not easy with the social situation in Monastir and the traffic in Enfidha. We do it, however, because we strongly believe in the future of Tunisia. We believe that this country can make 10 million on this region, 4 million on Monastir and 6 million on Enfidha in the next five years.

Your request to review the material conditions of the two airports has yet been motivated by a study that talked about a 65% decrease in air traffic!

This was true for the past.

Why have you asked for the review for the next two or three years?

Because, we need to address the deficit before paying. We pay royalties on the basis of profits. We make profit and then we pay the government. In the past, we paid. We paid 550 million Euros of investment and 150 million Euros in taxes, social security and for the concession. We have employed 5,000 Tunisians during the period of investment. Traffic declined by 6 to 2 million passengers. To deal with this situation and ensure the sustainability of this investment in getting the help of our partners, but the Tunisian government also must help us. You say in your article that this revision of the terms of the concessions was taken too soon. I would like to stress that discussions have begun since 2010, that, in the committee, there were seven ministers and these seven ministers had agreed, and you may imagine the level of bureaucracy when dealing with seven ministers. To say that the decision was taken too soon is not very fair.

You started working well before the Tunisian Revolution and the Arab Spring which you invoked as the cause of your problems. But maybe your business plan was not well put together?

Do you believe that institutions such as AfDB, IFC and 70 banks like Sociéte Generale, Goldman & Sachs, have agreed to put money into an unprofitable project and if the policy was invalid.

Our business plan is OK, but we are not independent of the environment where we work. Our traffic forecasts are made by a well known English firm and we expect a 21% increase in 2012, and this was our best argument in the latest discussions with the Tunisian government regarding the financial results.

When do you think the situation will improve in terms of passenger traffic?

The main traffic consists of tourism. As soon as the country will become stable and security improves, we are confident that tourists will return. Take the example of Morocco and Turkey. As soon as the sky was opened, traffic increased by 29%. Free the Tunisian sky and air traffic will increase. We know it is in the priorities of the Tunisian government, but is not yet on the agenda, but we think the results will be the immediate liberalization of the Tunisian sky.

Do you think you’re going to have to ask for another review of the conditions of your two concessions after 2012?

Currently, it is impossible to calculate political risk. I would say that the situation in neighboring Libya is more important. We cannot expect tourists to come, as there is war in Libya. We will wait to see the financial results for the coming years.

What is the current social situation in the Monastir airport?

It has clearly stabilized and the airport is fully operational. The problem is not social or financial in Monastir. The problem is the commercial presence of former concession holders whose contracts will soon end. They do not want to leave the country. There is a criminal and mafia organization that mobilizes the union.

Whom are you talking about?

DuFry, the company that manages the Free-shop. We appealed to sociologists who have worked for six months to determine for us the problem in Monastir. The conclusion was that the problem is not social. Employees have always been paid by TAV, including salaries and bonuses, despite the Revolution and the decline in traffic. The problem is the organized crime that exists there. That’s it. The government is aware and has taken steps to address them. That’s all I can say.

There have never been social movements, strikes or sit-in?

There were not in Enfidha. Instead, they are very happy that we create jobs for the region. As you can see, it’s very calm. In Monastir, all the problems that exist are not from the employees of the TAV Company.

Do you think that TAV has fulfilled its entire contract, particularly with regard to the second runway that should be built?

The second runway has never existed in the contract. We will build it when we reach a level of traffic of 15 million per year.

TAV Tunisia is also accused generally of diverting planes from Monastir to Enfidha. What is your response?

It’s true. We are always accused of that. They also say that we also pay the pilots to land at Enfidha. In 2010 we only had 400,000 passengers in Enfidha. In the tourism sector, it is the TO that decide in which airports planes land. We believe that both airports are complementary not competitors.

Perhaps these accusations are due to the fact that the turnover of Enfidha is probably higher than that of Monastir!

(Laughter) I hope it will. But to tell the truth, our revenue per passenger is actually more important. You know why? Because DuFry and Newrest [Editor’s note: The catering company] steal money from the government. DuFry pays only 32% of the concession to the state in Monastir while we perceive in Enfidha 42% and we are obliged to maintain their contracts until 2014.

We now understand that the contracts and Newrest DuFry Tunisia will not be renewed beyond 2014?

They pay the same percentage or they will leave. We will launch a new tender for this. The decision will be that of the highest bidder, and there are already other companies that are interested.

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