(College/ University)
Hong Kong International Airport: Discussions
Ever since it’s opening in the late 1990s, Hong Kong International Airport (HKIA) has grown to become one of the busiest air terminals in the world. At least 90 airliners have services to and from Hong Kong as well as other destinations on the mainland. Noted for its architectural design, efficiency, and service quality, the terminal has over the years have received numerous awards and citations from international organizations. Not only is the HKIA is a centerpiece transport infrastructure for Hong Kong, it is a global air transport terminal that provides significant revenue for the state. To center on the point, majority of the economic activity conducted in the state will not be possible without the operations of the HKIA (Three Runway Systems, n. d., pp. 3-4).
The 2030 Master Plan for the expansion of the HKIA is an extremely complex concern, with stakeholders from all sides making strong cases for their positions. Much of the concerns are concerned with the environmental damage the initiative will inflict on society. In the report of the Hong Kong Legislative Council, the body expresses a strong sense of concern on the matter; the body also suggested that the HKIA authorities use the time to establish a firm declaration on this matter to address trust issues that the project has generated with the affected parties and communities in the area.
Moreover, the logistics industry must be given consideration since the sector needs integrated facilities to be able to meet the increased cargo traffic to run parallel with the development of the HKIA in the future. In the 12th National Five Year Plan, the paper is supportive of the plans for developing the shipping, transport and several high value services that are consonant to the proposed expansion of the HKSAR. Nonetheless, the industry is more concerned with the lack of planning to allot parcels of land to centralize cargo logistics operations and other high value services such as warehousing in the airport terminal (Legislative, 2016, p. 3).
Background of the Problem
In the report of Hong Kong’s Airport Authority, the HKIA facility was expected not only to reach its designed capacity, but to well exceed that capacity. In this light, airport officials recommended the construction of a third tarmac to be able to meet present as well as future transport needs. The “2030 HKIA Master Plan” outlines extensive projections for the possible economic gains that the additional ramp will bring to the facility in particular as well as to the state in general. In addition, initial studies have been drawn to forecast pollution levels that will be generated by the additional flights into and out of HKIA.
Groups such as the Hong Kong Airport Authority and the World Wide Fund-Hong Kong have called for additional studies to determine the social and environmental effects with the construction of the additional runway. There have been prior studies that people from a diverse socioeconomic stratum can be impacted by the construction of the ramp, albeit in different ways (Corpuz, Hines, Hogan, Paredes, 2012).
Significance of the study
The synergy of an aviation terminal and business center is one of the primary contributors to the strong economic performance in Hong Kong. In a study conducted by a Chinese university on the construction of a third ramp; in the report, it disclosed that if the runway is efficiently used, this can give an additional HK$ 37 billion to the Hong Kong economy. It is also believed that each additional flight to HKIA can generate HK $375,000. However, though the HKIA can be considered as a remarkable success story, ironically, this success is also one of the largest impediments to its operation. It was expected that within the next five to seven years, the HKIA will be completely overrun, which is 15-20 years ahead of its original time frame of 2040.
Even during the early parts of the discussions, the two existing runways at HKIA were already faced with substantial problems. It was already believed that the runways were already bursting at the seams and operating the facilities were at a point that locating departure and landing positions for additional flights was becoming complicated. In 2010, it was expected that runway capacity was expected to hit 360,000 flights; it is expected that in 2030, flight frequencies are expected to hit 602,000 flights. This will completely overwhelm current capacity (Legislative Council of the Hong Kong Special Administrative Region, 2016, pp. 1-2).
It is expected that the air traffic, both in cargo and passengers, coming from China will reach more than 2 billion trips in 2030, while cargo traffic will be at 44 million tons. This numbers are not drawn from overly optimistic local projections; the World Tourism Organization predicted that China will become the fourth most significant tourist market by 2015. In addition, China is also the largest manufacturing country in the world, and these manufactures must be moved to a growing export market. In the Greater Pearl River Delta (GPRD) area, there are five air terminals: the HKIA, the Guangzhou Baiyun IA, the Shenzhen Bao’an IA, the Macao International Airport, and the Zhuhai Airport. Factoring the expected increase in air traffic to 2030, there is still an unfilled demand in the medium- and long-term (Three Runway, n.d., pp. 16-17).
The first choice to address the problem was to raise the capacity of the current airport. This option would include infrastructure improvements to the current facility, building new road systems as well as new “landside” transport networks at a cost of more than HK$ 42 billion. With the first option, it is expected that the facility’s capacity will increase from 50.9 million passengers and 4.1 million tons of cargo in 2010 to more than 74 million passengers and 6 million tons. These would allow the HKIA terminal to accept the expected yearly increase of 45 percent and the higher air traffic to 2020. The second proposed action was the construction of an additional runway; this option will entail the reclamation of land from the northern part of Chep Lap Kok Island and is expected to cost a staggering HK$ 136 billion. In the holding of HK airport officials, the construction of the additional runway is the better and more sustainable direction for the HKIA.
With the new ramp, the HKIA terminal will be able to take in 97 million passengers and nearly 9 million tons of cargo, extending the lifespan of the terminal up to 2030. The extension of the HKIA facility will create tremendous job opportunities and raise the profits of the facility as well as the adjacent businesses in Hong Kong. The additional runway is expected to generate a net value of HK$912 billion, and is expected to generate more than 190,000 job opportunities; the terminal extension option is only expected to generate 143,000 job opportunities (Corpuz, Hines, Hogan, Paredes, 2012, pp. 5-6).
With the significant financial resources needed to fund the project, the International Air Transport Association (IATA) reiterated the objective to enhance the competitiveness of the facility with the construction of the new ramp. The IATA drew up plans that would afford the HKIA to build the new ramp without raising airline fees or levying new taxes. HKIA airport officials, in this light, state that the various airliners using the facility support the “user pay” scheme to fund the project. The airlines would be the parties to shoulder the infrastructure costs, but not by paying higher fees, but owing to the higher volumes that these would convey to the HKIA.
These “charges” would apply to the new infrastructures as well as to the existing facilities. The new infrastructure and ramp will usher in a renaissance of the success of the HKIA in its first years of operation; however, this is heavily dependent on the facility either keeping or enhancing its competitive posture. However, though the airlines accept the “user pays” scheme, these oppose the charging of advance payments for the implementation of the project. In this light, airlines and users can only be charged for the use of the facility when the facility has been completed and not when it is still be built. If forward payments were to be charged from the airlines, the IATA predicts yearly reductions of up to 80,000 passengers and possible job losses for 600 workers annually (IATA, 2015).
Objectives
General Objective:
Establish the advantage of constructing a third ramp compared to the other options for the HKIA.
Specific Objectives:
Determine the viability of the project and advantages/criticisms
Establish issues and concerns regarding the construction of the third HKIA ramp
Research Questions
Is the construction of the third ramp for HKIA the optimal choice for the HKIA?
What are the benefits expected from the construction of the third ramp compared to other options?
What are the effects on the community and whether these effects are beneficial or detrimental?
Design
Prior to the development of the 2030 plan, previous initiatives centered on concerns if health, environmental impact, and community impacts that may affect the residents of the communities adjacent to the new facility. The community chosen in the study was Tung Chung; the area was chosen due to its proximity to the facility. Majority of the land occupied by the town was erected on reclaimed land that was specifically conducted for the construction of the new air terminal. In the past two decades, the town has undergone several ‘upgrades’ for the provision of living quarters for HKIA workers. Over the years, the Tung Chung area has grown into a highly urbanized area owing to the town’s access to mass transport systems and the nearby terminal. The facility is a critical driver in the Tung Chung economy; the community not only a community for the residents and terminal workers, the town also provides a refuge for travellers with places to rest and eat as well as an additional tourist spot (Corpuz, Hines, Hogan, Paredes, 2012, p. 14).
The completion of an additional runway generated a positive response from majority of Hong Kong residents. In an independent quantitative poll conducted by the Social Sciences Research Center of the University of Hong Kong, a total of more than 24,000 samples were given from June to September 2011. The report noted that more than 70 percent supported the construction of the third runway at HKIA; 11 percent of the respondents voted to maintain the existing system while the remaining component remained undecided.
The Hong Kong University poll also reported the sentiment of the public that the HKIA officials must immediately take steps to identify plans to expand the capacity of the HKIA. Owing to this positive and overwhelming response, HKIA officials proposed to endorse, for the purposes of planning, the three ramp option for the future widening and expansion of the HKIA facility. The qualitative results, on the other hand, continued to display the connection of a higher level of air traffic connectivity is a major contributor to higher levels of economic expansions, competitiveness and employment generation (Airport Authority Hong Kong, 2011).
Discussion
The competitive advantage of HKIA facility is coming under intense scrutiny. From 2005 to 2013, the market share of Hong Kong for commuters coming from China traveling abroad decreased from 20 percent to 17 percent. In fact, it has even languished at 10 percent with regards to its share in the ASEAN region travelling to North American destinations and its ASEAN-Europe routes has dipped to 2.4 percent, down from 3.3 percent (IATA, 2015). The expansion of the HKIA via the construction of the third ramp is expected to greatly benefit Hong Kong as a major arch to Mainland China.
With the expected increase in air traffic in the next few years, an expanded HKIA will prove to be a critical component for Hong Kong to take advantage of this instance. Though the presented options have their presented benefits as well as disadvantages, it is believed that the second option, or the building of the second ramp, will afford more benefits in the long-term. Given these projections, the development of the third runway is the best option to pursue in this case (Three Runway, n.d., pp. 55-56).
References
Airport Authority Hong Kong (2011) “HKIA Master Plan 2030: Over 70% of respondents prefer three-runway system: Airport Authority recommends government to adopt three-runway option as HKIA’s development direction” Retrieved from <https://www.hongkongairport.com/eng/media/press-releases/pr_1052.html
Corpuz, L., Hines, J., Hogan, G., Paredes, M (2012) “Effect of Hong Kong International Airport: an evaluation of the perceived impacts in Tung Chung” Retrieved from <https://www.wpi.edu/Pubs/E-project/Available/E-project-030912-205534/unrestricted/Effects_of_Hong_Kong_International_Airport_-_An_Evaluation_of_the_Perceived_Impacts_in_Tung_Chung.pdf
International Air Transport Association (2015) “Focus on competitiveness in HKIA expansion” Retrieved from <http://www.iata.org/pressroom/pr/Pages/2015-03-09-02.aspx
Legislative Council of the Hong Kong Special Administrative Region (2016) “Cathay Pacific Airways submission to Legislative Council Panel on economic development on Hong Kong International Airport Master Plan 2030” Retrieved from <http://www.legco.gov.hk/yr10-11/english/panels/edev/papers/edev0719cb1-2707-10-e.pdf
Three Runway System (n.d.). “HKIA Master Plan 2030” Retrieved from <http://info.threerunwaysystem.com/pdf/en/ES_20May_Eng_Ch2.pdf
