Asia tourism boom fu­els scram­ble for air­ports

From China and In­dia to the Philip­pines and In­done­sia, the fast-grow­ing mid­dle classes are look­ing to spend their cash by spread­ing their wings, lead­ing to a boom in the Asia-Pa­cific re­gion’s tourism sec­tor.

Viet Nam News - - Asia Business -

SIN­GA­PORE -— Faced with snaking queues at im­mi­gra­tion, over­flow­ing bag­gage carousels and ex­pen­sive flight de­lays, Asian na­tions are rush­ing to build hun­dreds of new air­ports to cope with surg­ing de­mand for air travel in the re­gion.

From China and In­dia to the Philip­pines and In­done­sia, the fast­grow­ing mid­dle classes are look­ing to spend their cash by spread­ing their wings, lead­ing to a boom in the Asia-Pa­cific re­gion’s tourism sec­tor.

Air­lines have re­sponded by set­ting up sev­eral new bud­get car­ri­ers and fly­ing new routes – but many air­ports are un­able to cope, forc­ing gov­ern­ments to ei­ther ex­pand or sim­ply build new air­ports.

“Through the next 10 years, we see more than 350 new air­ports in the Asia-Pa­cific and the in­vest­ment cost will be well over $100 bil­lion,” said Chris De Lav­i­gne, a global vice pres­i­dent at busi­ness con­sul­tancy Frost& Sul­li­van Asia Pa­cific.

“China is build­ing over 100 air­ports, In­dia is build­ing over 60 air­ports and In­done­sia will also have to fol­low suit with in­vest­ments in its in­fra­struc­ture,” said De Lav­i­gne, who closely tracks Asia’s avi­a­tion in­dus­try.

Up­grades of ex­ist­ing air­ports could cost an ad­di­tional US$25 bil­lion, he told AFP by tele­phone from his of­fice in Jakarta.

In­ter­na­tional tourist ar­rivals in Asia-Pa­cific grew an an­nual 6.0 per cent to 248 mil­lion last year, the strong­est of any re­gion world­wide, ac­cord­ing to the UN World Tourism Or­ga­ni­za­tion.

To cope with this, con­struc­tion is be­ing ramped up.

The Canada-based Air­ports Coun­cil In­ter­na­tional (ACI) said in a re­port that In­done­sia plans to build 62 new air­ports in the next five years, in ad­di­tion to its ex­ist­ing 237.

Soekarno-Hatta in Jakarta is im­prov­ing ca­pac­ity af­ter han­dling 60 mil­lion pas­sen­gers last year, nearly three times what it was de­signed for, ACI said.

And Kuala Lumpur aims to dou­ble ca­pac­ity to 100 mil­lion a year by 2020, while Hong Kong wants to han­dle 97 mil­lion an­nu­ally by 2030, up from 60 mil­lion in 2013.

In Bei­jing – which al­ready has a hub ser­vic­ing 80 mil­lion peo­ple – a sec­ond, $11 bil­lion air­port is be­ing built to open in 2018 and han­dle 40 mil­lion pas­sen­gers, Sydney-based con­sul­tancy Cen­tre for Avi­a­tion said.

There are also plans for a full re­place­ment of Manila'’s Ni­noy Aquino In­ter­na­tional Air­port, one of Asia’s most no­to­ri­ous for over­crowd­ing and back­ward fa­cil­i­ties.

Its Ter­mi­nal 1, which is un­der­go­ing a ma­jor makeover, was built in 1981 to han­dle six mil­lion pas­sen­gers a year.

To­gether with two ex­ten­sion ter­mi­nals, the air­port han­dled around 30 mil­lion pas­sen­gers in 2013.

‘Burst­ing at the seams’

Even Sin­ga­pore’s Changi – re­garded by many as one of the world’s best – is ex­pand­ing, with a $1bil­lion Ter­mi­nal 4 open­ing in 2017 that will raise ca­pac­ity to 82 mil­lion pas­sen­gers from the cur­rent 54 mil­lion. Plans are al­ready be­ing made for a Ter­mi­nal 5.

Shukor Yu­sof, an an­a­lyst with Malaysia-based En­dau An­a­lyt­ics, said air­port in­fra­struc­ture in many coun­tries has lagged well be­hind travel growth. “Many gov­ern­ments have paid scant at­ten­tion to de­vel­op­ing new ter­mi­nals and new tar­macs, that’s why you find that many of the air­ports are burst­ing at the seams,” he said.

The fo­cus is not just on cap­i­tals. The need for more space means much of the new con­struc­tion is tak­ing place in se­condary cities, with some fa­cil­i­ties po­ten­tially be­com­ing hubs.

De Lav­i­gne cited the Kualanamu In­ter­na­tional Air­port in In­done­sia’s Medan, which opened last July and could be­come a hub for flights to Malaysia, Thai­land, Myan­mar, In­dia and China.

It was de­signed to han­dle eight mil­lion pas­sen­gers a year but is al­ready at ca­pac­ity, he said.

“By 2025, they’re fore­cast­ing 24 mil­lion pas­sen­gers out of Medan, or a three-fold in­crease in just over 10 years,” De Lav­i­gne said, adding that In­done­sia’s avi­a­tion sec­tor alone is grow­ing 14-15 per cent a year.

Even less de­vel­oped tourist des­ti­na­tions are press­ing ahead with build­ing.

Myan­mar – re­turn­ing to the global fold af­ter decades of junta-led iso­la­tion – is look­ing to up­grade 39 air­ports as tourist and do­mes­tic air pas­sen­ger fig­ures are seen surg­ing to 30 mil­lion in 2030 from 4.2 mil­lion in 2013, the ACI said.

The govern­ment is also build­ing a new $1.5 bil­lion Han­thawaddy In­ter­na­tional Air­port to serve as Yan­gon ’ s sec­ond air­port, it added. Bangladesh is con­struct­ing a new air­port cost­ing up to $7.2 bil­lion about 60 kilo­me­tres (37 miles) from Dhaka, ACI said.

Fund­ing from gov­ern­ments and the pri­vate sec­tor does not ap­pear to be a prob­lem.

“There’s a lot of liq­uid­ity out there. There’s a lot of money in project fi­nanc­ing,” Shukor said.

Air­ports are now even tar­get­ing non-trav­ellers, with the cur­rent trend for “aeroparks and aerotropolises” in­te­grat­ing life­style ameni­ties, at­tract­ing din­ers and shoppers who won’t even board flights. —

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