ACI and ICAO Call for Asia Pacific Airport Growth

By Neelam Mathews

  Dec 7, 2015

ICAO secretary general Fang Liu (left) and Airports Council International director general Angela Gittens both warned that airport capacity is not keeping up with traffic growth rates in the Asia Pacific region. [Photo: Neelam Mathews]

The Airports Council International (ACI) and the International Civil Aviation Organization (ICAO) have joined forces to call for substantial development of airport infrastructure across the Asia Pacific region, and improvements in the way airports are regulated. In a conference held in the Indian capital New Delhi from December 2-4, ACI reported that passenger traffic is now growing at around 6.5 percent annually across the region and argued that regulators cannot hope to manage this growth effectively with regulatory constraints on traffic levels.

“Many airports in China and India continue to report significant gains in year-over-year passenger numbers. Shanghai and New Delhi grew by 15.8 percent and 12.8 percent, respectively,” said an ACI report. The Montreal-based industry body highlighted India as having particularly inadequate airport capacity.

“It is essential states prepare to reap the full benefits of [the forecast] growth in the years ahead,” stressed ICAOsecretary general Fang Liu. “Financing airport infrastructure is difficult for some states and poses potential risks to the sustainable economic development of their air transport sectors.”

According to an Indian airport official speaking to AIN on condition of anonymity, the country’s current airport regulations yield poor financial returns for investors because, “the rules are changed according to the whims of the government.” ACI director general Angela Gittens called for the so-called “single-till” business model to be abandoned in India in favor of a hybrid or dual-approach. Under the single-till structure, flight operations and commercial activities are combined to determine the basis for airport charges. A dual-till approach only bases charges on flight activity, and, according to ACI, results in increased overall revenues for airports, in turn providing a stronger incentive for companies to invest in better and larger infrastructure.

“Empowering public and private airports to be more commercially oriented is the next step in building a successful industry. We need to take this step and keep regulatory intervention to a minimum,” said Gittens. “Unlike the U.S.that has a liberalized airline industry, many airports [around the world] are still subject to haphazard and heavy-handed regulation that is administratively burdensome and unnecessarily costly.”