Singapore to Double Changi Airport Capacity as Demand Increases

January 12, 2014 Leave a comment

Singapore to Double Changi Airport Capacity as Demand Increases

Singapore plans to almost double the capacity of its airport over the next decade with two terminals as the economic growth in the Asia-Pacific region makes it more affordable for people to travel by air.Changi airport, Asia’s second-busiest for international travel, is expected to handle about 5 percent more passengers each year through the next decade, Singapore’s Transport Minister Lui Tuck Yew said yesterday. A fourth terminal, which will be built by 2017 at a cost of S$1.28 billion ($1 billion), will handle 16 million passengers annually. A fifth will be added in the middle of the next decade to handle 50 million travelers, he said.

“We need to have capacity ahead of demand,” Lui said in an interview with Haslinda Amin. “You see rising income levels in Southeast Asia and Asia. You see aviation being increasingly within the reach of a larger segment of the population.”

From Vietnam to Indonesia, more than a dozen budget airlines have started across Southeast Asia in the past decade. Economic growth in the region, with a population that’s two times bigger than the U.S., boosted demand for air travel.

The capacity at the fifth terminal, which Lui described as a “mega” terminal, could increase to 75 million, he said. Changi, which serves more than 100 carriers, currently has a capacity to handle of 70 million passengers in the existing three terminals, he said.

The airport will also lengthen an existing runway currently operated by the air force for commercial use, adding to the existing two landing strips. Changi handled 48.6 million visitors in the first 11 months of last year.

The total wealth of millionaires in the Asia-Pacific region may top that of their peers in North America as soon as this year, according to a report by Cap Gemini SA and Royal Bank of Canada published Sept. 25. Travel demand in the Asia-Pacific region is expected to increase 7.4 percent this year, according the International Air Transport Association.

To contact the reporter on this story: Kyunghee Park in Singapore at kpark3@bloomberg.net

Filed under Macro Trends

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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