‘INVESTORS WANT CERTAINTY, INCENTIVES’
Government must introduce proper regulations, ensure good management to attract private sector, says ACI
PRIVATE investors want certainty and incentives before investing in airport development, said a senior industry executive. Airports Council International (ACI) director-general Angela Gittens said governments should be transparent on the rules.
“The current (Malaysian) government wants the airport operator to invest in capital, which changes the financial situation for the operator.
“Hence, the government should set up proper regulations coupled with good management to ensure return on invested capital for the private sector,” she said at the ACI Asia-Pacific Small and Emerging Airports Seminar 2018, here, recently.
She said the government must allow airport operators or investors to find the best ways to implement the right approaches in meeting their goals.
“It is possible to get private capital for airport if the government has the right incentives for investors. The private sector prefers airports with stable and sustainable long-term returns.”
Gittens said more countries were looking for private investments.
She also said infrastructure was becoming a pressing matter in the Asia-Pacific region, which was growing rapidly.
Gittens said airport operators were looking to boost non-aeronautical revenue amid fierce competition.
“Smaller airport operators need non-aeronautical revenue to service their debts and pay their employees,” she said.
ACI’s World Airport Traffic Report published last month highlighted that passenger traffic in advanced economies reported a 5.2 per cent growth last year while that of emerging economies grew 10.3 per cent.
ACI Asia-Pacific secretary treasurer Sheikh Aimen Ahmed Al Hosni said the association continued to see tremendous growth in emerging markets.
He said the overall economic growth in Southeast Asia was expected to stay solid due to demand from China and Europe.
Among the 10 fastest-growing countries, nine will be from Asia Pacific and Middle East, comprising China, India, Indonesia, Iran, Saudi Arabia, the United Arab Emirates, Malaysia, Vietnam and the Philippines.
“These fast-growing markets are all emerging and developing economies and expected to account for more than 60 per cent of the global passenger traffic by 2040,” he said.