LIBERIA: U.S. FIRM SHOWS INTEREST IN AIRPORT INVESTMENT

UNCLAS MONROVIA 000345

SENSITIVE
SIPDIS

DEPARTMENT FOR AF/W AND INR/AA FOR BERNADETTE GRAVES
DEPARTMENT PLEASE PASS OPIC FOR JOHN SIMON

E.O.12958: N/A
TAGS: EAIR ECON PGOV FAA LI
SUBJECT: LIBERIA: U.S. FIRM SHOWS INTEREST IN AIRPORT INVESTMENT

REF: 07 MONROVIA 1033


1. (SBU) SUMMARY: U.S.-based aerospace and advanced technology
firm Lockheed Martin (LM) is developing a proposal to manage civil
aviation assets in Liberia. The Liberian Civil Aviation Authority
(LCAA) invited an LM team to visit Liberia in February and April,
2008, to assess the scope of a possible management contract that
could cover Roberts International Airport (RIA) and possibly other
domestic airports. LM is now reviewing the business case for an
investment as well as the legal terms that would be required for a
possible concession. A significant investment in Liberia's airport
by a reputable firm would be a welcome development, but any deal
will face considerable legal and political challenges. END SUMMARY.



2. (SBU) Ambassador met April 8 with LM Senior Manager for Air
Operations Michael O'Toole, accompanied by Stephen Cashin of Pan
African Capital Group and Tom Jeffrey from International Bank of
Liberia. O'Toole explained that LM had been invited to Liberia by
the LCAA as part of GOL efforts to attract interest in the civil
aviation sector from a large, reputable firm. LM senior managers
met with President Sirleaf in February and then sent a six-member
technical team in April to conduct a deeper assessment.


3. (SBU) LM intends to submit a proposal to the LCAA and the
President during a return visit in July. The proposal will likely
focus on a long-term management contract for RIA, though LM
representatives are also examining the Monrovia municipal airport,
Spriggs-Payne Airfield, and the possible provision of regional
and/or domestic air services. O'Toole said LM is also examining the
utility of using RIA as a logistics hub for LM activities in Liberia
and elsewhere in the region. (Note: LM subsidiary Pacific
Architects and Engineers (PAE) is involved in training the Armed
Forces of Liberia and the Liberia National Police, and provides
advisors to the Ministry of Justice. End note). According to
O'Toole, there is much interest at the highest levels of LM in the
project. LM's Business Development Team is preparing the business
model while LM is working through its subcontractor Matrix Design
Group on the technical assessment of RIA and through Pan African
Capital Group on finance.


4. (SBU) COMMENT: Any potential public-private partnership for RIA
will be challenging. According to airlines, RIA has some of the
highest fees and worst service in the region. LM confirmed a list
of airport deficiencies: inoperable omni-directional radar
(VOR-DME),no GPS landing facilities, poorly calibrated instrument
landing system (ILS),insufficient runway lighting, unreliable power
supply, insecure cargo handling, unprotected storage, environmental
damage, and woefully inadequate safety and security information.
(Note: A USAID program is supporting the purchase of approximately
$4 million in emergency safety equipment this year. End note). Any
agreement with the GOL will have to be for a sufficiently long time
period to recuperate the investment. The legal framework that would
allow the GOL to outsource airport management is murky as a draft
Act establishing the RIA as an autonomous entity remains in limbo
within the President's office. Political and economic interests
have dogged that act and would likely challenge any LM proposal as
well. That said, a strong proposal from a reputable international
firm is an unexpected and encouraging development for the Liberia
and its feeble airport. END COMMENT.

ROBINSON