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Users shouldn’t be pre-funding airport expansion: IATA chief
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Users shouldn’t be pre-funding airport expansion: IATA chief

Governments and airports should not expect users to pre-fund expansion projects, said the chief of a global airline body yesterday.

He was commenting on plans by Singapore to likely do this for the future Terminal 5 at Changi Airport.

Speaking to reporters on the sidelines of the Singapore Airshow Aviation Leadership Summit 2018, the chief executive officer and director-general of the International Air Transport Association (Iata), Mr Alexandre de Juniac, said: «We have mentioned many times that we are not in favour of pre-funding. We have a permanent dialogue with Singapore on this and we will keep reiterating and repeating this.»

Last month, The Straits Times reported that passengers flying out of Changi may soon have to pay between $10 and $15 extra, as part of a new tax being mooted to help pay for a major airport expansion, involving the building of T5.

Transit passengers could be charged about half the amount.

The tax, which could be imposed from later this year, is expected to be on top of the $34 departure charge ($6 for transit passengers).

Fees for airlines, including parking and landing fees, are expected to increase by about 30 per cent.

Referring to the report, Mr de Juniac said at Pan Pacific Singapore hotel yesterday: «The airline industry does not support pre-funding to finance advance infrastructure projects.»

Even as he applauded Singapore for showing «great foresight» with the expansion plans, he said: «We need to get the funding model right to avoid burdening the industry with extra costs.»

He said Seoul’s Incheon Airport «recently expanded runway and terminal capacity to meet growing demand. Importantly, that has been done without raising charges. In fact, Incheon recently extended a discount on airport charges… introduced two years ago».

Other airports, though, have introduced user charges to support growth plans. In 2016, Hong Kong International Airport, which is building a third runway due to be completed in 2024, started collecting between HK$70 (S$12) and HK$180 a traveller.

T5 is expected to eventually handle up to 70 million passengers a year – more than terminals 1, 2 and 3 combined – when completed. However, a third runway being built in the same project will be operational before that, in the early 2020s. The new terminal will be part of a larger Changi East project, whose total bill is expected to run into tens of billions of dollars…

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