The General Authority of Civil Aviation (GACA) was established in 1934, but its actual operations started in 1945.
Over the years, the Kingdom has achieved unprecedented growth and has made qualitative leaps in civil aviation. However, since the privatization of GACA we have witnessed a marked improvement in its overall performance.
We have always called for appointing professionals from the private sector to manage profit-seeking government organizations.
A quick review of the past year’s achievement will show that restructuring of the Saudi airports in general and improvement of services has helped in transformation of the air travel services to cope with global competiveness.
It is true that evaluation of one year’s achievement is not enough, but the question is: Are we moving in the right direction? The answer, from my point of view is “yes,” because changes are tangible and we expect to see more achievements in the years to come.
However, privatization process needs more analysis and reviews. This process can take many forms: Full sale of some government organizations or the biggest share in them. But what determines how the privatization decision is successful or not are the outcomes, either in the form of increased revenues or reduction of costs or improved quality of services.
In all cases, the private sector’s participation in state-owned organizations where its shares enable it to manage these organizations has negative and positive impacts. However, the negative impacts are subject to national or societal concepts, rather than economic or profitability concepts.
But what I mean here is the privatization of management, i.e. to hand over management of public organizations to a group of efficient and competent private sector managers. I exclude here businessmen who are interested only in the comprehensive concept of privatization. I believe that the public sector should attract them and empower them with all necessary resources to advance and develop the public organizations.
A good example of this suggestion is GACA where the executive lounges at the airports, which were previously run by the authority, were given to a private company, which increased fares but failed to improve services. In fact, this is not privatization but sub-contracting. Because of this horrible failure, the authority was forced to reclaim those lounges and run them according to management privatization system. According to this arrangement, the authority handed over the management to a team of private sector experts. Now prices are lower and services are better leading to an increase in the number of people using these lounges.
We should learn from this experience. If we apply it to a number of public organizations by attracting executives from the private sector and providing them with the required legislations to practice their task freely, we'll definitely move forward and progress faster.
