A daily bulletin of news & opinion

16 June 2011

Hong Kong airport is reaching saturation point. On the doorstep of the world’s second largest economy and faced with increasing competition from rivals in both mainland China and nearby Singapore, Hong Kong is planning to build a third runway.

“It’s not far into the future that we will come up against congestion,” says Andrew Herdman, director general of the Association of Asia Pacific Airlines. But the decision to expand the airport can also be seen as part of an ongoing competition between Singapore and Hong Kong – two of the rising stars in Monocle’s Top 25 Liveable Cities. While Singapore is good at greening its environment, preserving some of its old-world architectural charm and developing a sustainable public housing policy, Hong Kong does well on perpetuating its city buzz.

Both cities have public transport systems that should be the envy of the world. They are experts at attracting global banks thanks to favourable corporate tax-laws (Hong Kong 16.5 per cent; Singapore 17 per cent).

And they are now pouring the dollars into arts and culture development. Singapore’s creative industries are getting S$978.2m this year and Hong Kong is setting aside HK$21.6bn (€1.97bn) for a new cultural district.

Just as the the world is eyeing Asia’s financial rebirth, Singapore and Hong Kong are putting quality of life on the agenda, all in an effort to retain and attract talent and to accommodate for larger volumes of people and cargo moving through its airports.

All of which means that the size of the airport matters a great deal. Singapore’s Changi Airport handled 42 million passengers last year compared with 50.9 million at Hong Kong’s airport Chek Lap Kok. Both airports are making room for passenger growth. Singapore is refurbishing its T1 to the tune of S$500m but Hong Kong is thinking bigger.

The third runway project, estimated to cost HK$80bn, would be built on an additional 6.5 sq km reclaimed land (Hong Kong International Airport, which opened in 1998, is built entirely on man-made land) and would up capacity to 97 million passengers a year from 2030.

“In the Asia-Pacific, aviation is seen in a positive light – as part of economic development,” Herdman says. “That’s why you see a willingness by governments to invest heavily in good transport infrastructure.”

More than anything, upgrades of Singapore’s and Hong Kong’s airports will define which of the rival cities will stay in the lead. And, no doubt, keep the rivalry going for the foreseeable future.


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