Building boom

China has embarked on an ambitious programme of new airport construction and expansion of existing facilities as the country's infrastructure plays catch-up with breakneck growth in air transport since the mid-1980s. This building boom is now at its peak, with the government projected to spend some yuan100 billion ($12.1 billion) by the close of the current five-year plan in 2000.

Official statistics list some 141 civil or jointly administered military airports in China handling scheduled flights, of which 37 are open to international traffic. They range in size from Beijing Capital Airport, with a throughput of nearly 17 million passengers and 457,500t of air freight in 1997, down to small domestic facilities with just a few thousand people passing through each year. This compares to just 77 airports open in 1980, at the outset of Beijing's foray into economic reform.

Impressive as this increase in gateways might appear, infrastructure has struggled to keep pace with double-digit traffic growth. Chinese carriers in 1997 carried 56.3 million passengers, compared to 3.43 million 18 years ago. The immense potential for further growth in this increasingly prosperous nation is perhaps best illustrated by the fact that some 1.24 billion Chinese travelled by either bus or train in the first quarter of this year alone.

Frequently quoted Civil Aviation Administration of China (CAAC) forecasts predict that the number of local air travellers is set to double and that air freight will quadruple by early in the next decade. While Asia's recent economic difficulties may serve to vent some steam out of China's near-term growth rates, indicators continue to point to an overall upward trend.

The CAAC, accordingly, is attaching a high priority to the development of airports, which it projects will increase in number to 170 by 2010. Beijing's ninth five-year plan (1996-2000) provides for the new construction or upgrading of 41 airports which collectively account for 95% of local traffic.

To date, work has already been completed at 18 airports, construction is under way at 10 more and the remainder are in the planning stage. Of these, the three most important projects are the completion next year of Shanghai's new Pudong International Airport, the long delayed start of work on the replacement Guangzhou New Airport at Hua Do and the opening of a new passenger terminal at Beijing Capital. These three projects alone will consume 40 billion.

Pudong is scheduled to open officially on 1 October, 1999, making Shanghai the first mainland Chinese city to possess two international airports. The 26.5km2 (10.2 miles2) airport site, partially built on reclaimed land, is situated in the Pudong new development zone, 30km (18.5 miles) to the east of downtown Shanghai and some 40km from the city's Hongqiao International Airport.

The opening of Pudong will come as a relief to Hongqiao, which despite a 540 million terminal and apron expansion in the early 1990s, is operating well in excess of its 9.6 million passenger design capacity. The airport, the China's second busiest, recorded a throughput of nearly 13.3 million passengers in 1997, up by 7.5% on the previous year. Freight grew by another 16.7%, topping 476,000t, eclipsing even Beijing Capital.

Pudong will open equipped with one Category 3-rated, 4,000m (13,100ft)-long runway and a 200,000m2 (2.15 million ft2) passenger terminal. It will have an initial design capacity to handle 20 million passengers and 750,000t of cargo annually, sufficient to cope with the city's demands through to 2005, claims Yu Wuyan, Pudong deputy commander-in-chief.

With Shanghai traffic forecast to top 33 million passengers within seven years, the Pudong master plan, drawn up by Aéroports de Paris (ADP), contains provision for a further two phases of expansion. On final build-out, the airport will boast a total of four parallel runways and 800,000m2 of passenger terminal space, capable of handling some 70 million passengers and 5 million tonnes of freight annually.

Work on a second, equally large green field development in in the southern Chinese city of Guangzhou is due to start in March 1999. The planned replacement for the city's congested Baiyun International Airport, China's third busiest gateway, has progressively slipped since the project was announced in 1992, while the estimated cost has doubled to some 20 billion.

The start of construction has been delayed by a series of financing and land requisition issues. It is planned to fund the cost of the new airport at Hua Do from the proceeds of selling the existing airport site, 17km to the south, for land redevelopment. Baiyun, however, is jointly owned by the Guangzhou Municipal Authority and the Chinese army. Resolving this initially proved to be an issue.

There has then been the added complication more recently of local residents protesting against the construction of the new airport, a phenomenon that is common in other Asian countries such as Japan, but virtually unheard of in Communist-controlled China. The new 1,600Ha (3,950 acre) development has reportedly entailed the removal of some 20,000 people from nine farming villages.

Following final approval from Beijing and the local municipal authority, which is funding 49% of the airport with the CAAC financing the remainder, it is planned to break ground after the Chinese New Year in early 1999. It is hoped to have the initial phase of the airport open by late 2001, although there is pressure to try to advance this by six months, in time for the local staging of the ninth national games.

An initial $10 million terminal design contract has been awarded to the Parsons-URS Greiner partnership over competing bids from ADP and Norman Foster. The 297,000m2 building will include 52 gates and will have an initial design capacity of some 27 million passengers annually, compared to the 12.5 million that crammed through Baiyun in 1997. The airport is intended to have an eventual build-out capacity of 80 million passengers and 2.5 million tonnes of cargo.

The airport will be equipped with one 4,000m-long main runway and a second 3,700m runway, with provision for a third to be added later. Associated developments will include a new expressway and elevated railway connecting with downtown Guangzhou, 28km to the south, and the eventual construction of three new three-bay hangars for Guangzhou Aircraft Maintenance Engineering.

China's third major airport investment has been the construction of a new passenger terminal building at Beijing Capital, at a cost of ´9.2 billion. The new terminal, which is roughly five time the size of the existing combined international/domestic building, boasts 44 gates, 168 check-in desks and will be capable of processing up to 10,000 travellers every hour. The expanded airport will have a design capacity of up to 35 million passengers annually, almost twice its 1997 throughput.

The structure of the new 330,000m2 building was topped off in July and, once fully fitted out, is scheduled to open in October 1999. Foreign contractors include Rockwell Automation, supplying the baggage handling system, SITA the utility information system and Unisys equipping the terminal with its airport passenger processing system. Raytheon has already completed a $7.5 million upgrade of the airport's radar and flight data control displays.

China has traditionally financed its airport construction and improvements using state resources, either in the form of capital funds or soft loans from state development banks. The sheer number of projects and associated high costs contained in the ninth five-year plan has necessitated the introduction of more creative financing schemes.

Beijing and Pudong have both been partially financed with the aid of overseas borrowings, the latter in the form of a Japanese ´40 billion line of credit from the Japanese Government. About one-third of the Shanghai development has been underwritten with foreign loans, with the remainder divided equally between the local municipal authority and the Chinese State Development Bank.

China is also increasingly turning to the domestic and international equity market for financing, with plans announced to list Beijing Capital and the Guangzhou New Airport. Hongqiao has sold 270 million domestic A-shares on the Shanghai bourse, raising some ´1.9 billion, which in turn will be invested in Pudong. Huangtian Airport has also issued 100 million A-shares on the local Shenzhen exchange to raise funds for a new 72,500m2 passenger terminal being built for ´1.2 billion.

The infusion of foreign capital has in turn forced Beijing to review its policy on the management of China's airports, which has traditionally been the preserve of the CAAC , or to a lesser extent local municipal or provincial governments.

Under new rules which the CAAC has promised to promulgate by the end of the year, foreign investors will in future be entitled to hold up to a 49% share of an airport's registered capital and take a role in management.

Wuhan's Tianhe Airport is set to become the first to open its doors to a foreign investor, in the form of Hong Kong property developer New World. The company is reported to be negotiating to take an undisclosed stake in the newly established Wuhan Tianhe Airport company. The injection of new capital will help finance a planned 50,000m2 passenger building for the three-year-old airport.

Other provincial airport developments are also expected to try and take advantage of the CAAC's laissez faire reforms. Shenyang is seeking $120 million in foreign investment to expand its Taoxian International Airport. Other new projects include a ´1 billion expansion of passenger, cargo and apron facilities at Kunming - China's fourth busiest airport in 1997, a new 560 million passenger terminal for Urumqi Airport and some ´190 million in runway, taxiway and apron improvements at Chongqing's Jiangbei International Airport.

Source: Flight International