ACI ASIA-PACIFIC
airports and existing infrastructure. We recognise there is no one-size- fits all in how we manage, fund or invest in our airports. Recent trends point to privatisation as a way to finance much needed infrastructure investments as a means to increase capacity. Japan and India are now at the forefront of this business evolution, with prominent privatisation activities taking place in the last six months.
The ensuing US-China trade war, global economic slowdown and resultant currency volatility means travel retail is cautious about spending levels at airports in the region this year. Is this uncertainty likely to persist in the long term? We have seen China redouble its efforts to boost domestic consumption as the US-China trade war ensues. A recent study has shown that many Chinese consumers are buying luxury goods in China, instead of travelling to previous places like Tokyo, Seoul and Hong Kong. This is obviously worrying for travel retail, especially airports in the region that have their eyes on the Chinese travellers. Numbers are still good in 2018, as both Incheon and Dubai airports posted record duty free sales. In the longer term, we believe growth in travel retail will likely continue, but at a more moderate level, as other nationalities such as Koreans and Indonesians fill the void.
How big an opportunity is China’s Belt and Road initiative (BRI) for Asian airport connectivity given the $1 trillion-plus investment spans a number of other transport projects (ports, roads, railways, telecommunications networks etc.)? We will without doubt witness an astounding growth in infrastructure and people exchange, with airports being a critical component in the scheme. In this day and age of connections, we will all be affected by this major development. In 2018, according to CAA (Civil Aviation Administration) of China, over 100 new international routes were developed in relation to the Belt and Road
MAY 2019
Initiative (BRI). The overall sea/ land/air connectivity along the BRI countries will be greatly enhanced to provide many new transport and business opportunities between the West and the East.
China and India accounted for more than 60% of the total traffic increase in Asia Pacific last year. Is this likely to continue in the next year(s) given the pace of growth in both is trending downwards as demand softens? We continue to see healthy growth in both China and India’s domestic passenger traffic. Coupled with strong regional economic development and expansion of international routes and low-cost carriers. This growth is expected to continue, although not as robust as previous years. According to the ACI World Airport Traffic Forecast 2018- 2040, the top ten fastest growing countries are Vietnam, India, Saudi Arabia, UAE, China, Philippines, Indonesia, Colombia, Mexico and Malaysia. Eighty percent of the top ten fastest growing countries are in Asia Pacific and the Middle East and all are emerging and developing economies.
Finally, where lie the biggest opportunities and challenges for air transport and commercial development in both regions in 2019 and what is ACI Asia-Pacific doing to address these? Riding on China’s ‘One Belt One Road’ initiative to connect countries together for mutual cooperation,
“The recent Qatar-EU aviation agreement to increase mobility, tourism and trade exchange is a great example of a state finding its footing in the whirlwind of a complex global economy.”
Patti Chau, ACI Asia-Pacific
we believe there are plenty of opportunities worth exploring in Central Asia. Benefitting from its strategic geographic location, airports in Kazakhstan and its neighbours are well-positioned to develop themselves as the Eurasian hubs for the forecasted thriving growth in transcontinental traffic. The recent Qatar-EU aviation
agreement to increase mobility, tourism and trade exchange is a great example of a state finding its footing in the whirlwind of a complex global economy. This agreement will translate to the development of new air services, providing more choices for consumers and supporting the economy. As the trade tensions between China and the US continues, our region remains influenced by regional happenings such as China’s economic slowdown and geopolitical restlessness in the Middle East. But amid these opportunities and challenges, we in the aviation industry, in cooperation and collaboration with government and stakeholders need to provide a good passenger experience, keep the system safe, secure, efficient, economically and environmentally sustainable. «
Patti Chau is joined by Angela Gittens, Director General ACI World (second left); Martin Eurnekian, Chair, ACI World (third left); Seow Hiang Lee, President, ACI (far right) and other aviation, government and tourism officials at the ACI WAGA Opening Ceremony.
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