A glitzy new airport that opened recently in Thailand reflects Asia's need for investment to cope with a fast-growing aviation sector, industry analysts say.
While the opening of Suvarnabhumi international airport has intensified rivalry within Asia for market share, analysts say an expanding aviation sector means there is enough business for everybody.
"We are not worried about over-investing," said Paul Behnke, director of economics at Airports Council International (ACI).
PHOTO: AFP
"There is under-investment in some of the key countries and frankly, airport capacity is in short supply," he said.
Passenger traffic in the Asian region is projected to grow 8 percent this year and 7.8 percent next year, faster than the global average of 5.1 percent for the same period, according to ACI.
Air freight traffic in Asia is expected to grow an average 6.9 percent in the 2004-2020 period against the global average of 5.4 percent, said the Geneva-based body whose 557 members operate more than 1,530 airports globally.
"The reality is the region needs new international capacity and we welcome new capacity," he said. "I don't see many airports out there that are terribly under-utilized."
Bangkok's new airport, which cost US$3 billion, has a capacity of 45 million passengers a year, well ahead of its rivals in Singapore and Malaysia.
That capacity is expected to more than double when it becomes fully operational, but for now it is on par with the eight-year-old Hong Kong International Airport which received 40.3 million passengers last year.
An additional US$15.8 million has been allocated for a budget airline terminal to open there next year.
Suvarnabhumi, which opened on Sep. 28, replaces Bangkok's creaking Don Muang which was straining under an annual load of 39 million passengers, two million more than it was designed for.
"In the case of the Bangkok airport, it definitely was a rational investment ... Don Muang was for years operating well above its design capacity and the resultant bottlenecks were keeping Thailand's aviation sector below its natural level," said Richard Pinkham, a Singapore-based analyst with the Center for Asia Pacific Aviation (CAPA).
"In order to keep things moving forward, investment in upgrading infrastructure was necessary," he said.
Asia needs to continue developing its key airports if the region's economies, especially the tourism sector, are to blossom, analysts said.
"Asia's major hubs will continue to have to invest in new airport capacity, to meet expected trade and tourism growth," said Peter Harbison, executive chairman of CAPA, a Sydney-based independent aviation consultancy.
"The capacity shortages run the risk of undermining hub competitiveness, not to mention inconvenience to passengers, while airport congestion can also lead to financial loss for airlines," he said.
John Koldowski, director for strategic intelligence at the Bangkok-based Pacific Asia Travel Association, said airport investment places the region in a strong position to cater to Asians' rising affluence.
"The near-term future for air travellers particularly is very, very strong," Koldowski said.
"Asia is the place to be, period. You have a good-sized population and they are becoming richer ... that is a good combination," he said.
Key airports in the region are taking the competition posed by Bangkok's Suvarnabhumi in stride, saying they will also enjoy a boost as it draws more travellers to Asia.
"When tourists fly to Bangkok and Singapore, there is a spinoff with some coming to Malaysia. Similarly when they come to Malaysia, they also fly to other countries in the region. We always get a spinoff," said Bashir Ahmad, managing director of Malaysia Airports Holdings Bhd, which runs the Kuala Lumpur International Airport.
"It will not pose a rivalry to Kuala Lumpur International Airport. All the airports in the region including KLIA and Changi in Singapore are doing well," he said.
US President Donald Trump yesterday announced sweeping "reciprocal tariffs" on US trading partners, including a 32 percent tax on goods from Taiwan that is set to take effect on Wednesday. At a Rose Garden event, Trump declared a 10 percent baseline tax on imports from all countries, with the White House saying it would take effect on Saturday. Countries with larger trade surpluses with the US would face higher duties beginning on Wednesday, including Taiwan (32 percent), China (34 percent), Japan (24 percent), South Korea (25 percent), Vietnam (46 percent) and Thailand (36 percent). Canada and Mexico, the two largest US trading
AIR SUPPORT: The Ministry of National Defense thanked the US for the delivery, adding that it was an indicator of the White House’s commitment to the Taiwan Relations Act Deputy Minister of National Defense Po Horng-huei (柏鴻輝) and Representative to the US Alexander Yui on Friday attended a delivery ceremony for the first of Taiwan’s long-awaited 66 F-16C/D Block 70 jets at a Lockheed Martin Corp factory in Greenville, South Carolina. “We are so proud to be the global home of the F-16 and to support Taiwan’s air defense capabilities,” US Representative William Timmons wrote on X, alongside a photograph of Taiwanese and US officials at the event. The F-16C/D Block 70 jets Taiwan ordered have the same capabilities as aircraft that had been upgraded to F-16Vs. The batch of Lockheed Martin
GRIDLOCK: The National Fire Agency’s Special Search and Rescue team is on standby to travel to the countries to help out with the rescue effort A powerful earthquake rocked Myanmar and neighboring Thailand yesterday, killing at least three people in Bangkok and burying dozens when a high-rise building under construction collapsed. Footage shared on social media from Myanmar’s second-largest city showed widespread destruction, raising fears that many were trapped under the rubble or killed. The magnitude 7.7 earthquake, with an epicenter near Mandalay in Myanmar, struck at midday and was followed by a strong magnitude 6.4 aftershock. The extent of death, injury and destruction — especially in Myanmar, which is embroiled in a civil war and where information is tightly controlled at the best of times —
China's military today said it began joint army, navy and rocket force exercises around Taiwan to "serve as a stern warning and powerful deterrent against Taiwanese independence," calling President William Lai (賴清德) a "parasite." The exercises come after Lai called Beijing a "foreign hostile force" last month. More than 10 Chinese military ships approached close to Taiwan's 24 nautical mile (44.4km) contiguous zone this morning and Taiwan sent its own warships to respond, two senior Taiwanese officials said. Taiwan has not yet detected any live fire by the Chinese military so far, one of the officials said. The drills took place after US Secretary