RANGOON — With the winning bids for Burma’s three major new airport projects due to be announced by the end of this month, officials say the contracts are necessary, given that the government hopes to draw over 7 million tourists to the country by 2020.
The existing international airports for Rangoon and Mandalay will be upgraded, while a new international airport—expected to rival other major Southeast Asian hubs such as Bangkok’s Suvarnabhumi and Singapore’s Changi in size—will be built at Hanthawaddy in Burma’s central Pegu Division, about an hour’s drive north of Rangoon, the country’s biggest city.
“The new airport will be nine times the size of the current Yangon [Rangoon] airport,” says Win Swe Tun, deputy director-general of Burma’s Department of Civil Aviation (DCA), part of the country’s Transport Ministry.
“The main reason to build the new airport is that the market demands,” he told The Irrawaddy. “The bid requires the winner to have the airport ready by 2018 and be able to take up to 12 million passengers a year.”
The Burmese government recently announced a tourism plan that envisages a possible 7.4 million visitors by 2020, up from just over 1 million last year, though the blueprint also acknowledges that visitor numbers could be as low as 2.81 million by that time.
If realized, the plans for an expanded tourism sector would be worth over US$10 billion per annum to Burma’s economy, according to the Asian Development Bank (ADB).
Tourism Minister Htay Aung says the mooted new airport, which will feature a double runway, is needed to attract long-haul carriers to fly direct to Burma. “Now our flight options are very limited, so we need to open the new and bigger airport at Bago [Pegu],” he said.
While new routes from Doha, Frankfurt and Seoul to Rangoon’s international airport have become available in recent years, currently most visitors to Burma from Europe and North America fly via Southeast Asia’s bigger airports, including in Bangkok, Kuala Lumpur and Singapore, which have regular long-haul intercontinental flights.
Four companies or consortia are in the final shake-up for the new Pegu airport construction project: Taisei of Japan, Vinci of France, Korea’s Incheon and Yongnam from Singapore. The winning bids will be announced by the end of July, says Win Swe Tun, along with the chosen pitches to upgrade Rangoon and Mandalay’s international airports. All the bids are being assessed by a selection board comprising Burma’s minister and deputy minister of transport along with the director-generals from the Myanmar Investment Commission and the DCA.
The Rangoon international airport upgrade contest features seven contenders, including Burmese company Pioneer Aerodrome Services, which is linked to Steven Law, a businessman described as close to Burma’s former military junta and subject to US sanctions. Another contender is the US-based ACO Investment Group, whose bid features former US government official Kurt Campbell, who visited Burma several times in his role as assistant secretary of state for East Asian and Pacific affairs and was a pivotal figure in the first Obama administration’s overtures to Burma’s reforming government.
Rangoon’s current airport is built on a former World War II British Royal Air Force base at Mingaladon, a northern suburb, and is next to a current Burmese air force base. Featuring just a single runway, the airport was designed to handle 2.7 million passengers per year but is currently running over capacity, as it handles 94 percent of international air traffic to and from the country, says managing director Win Ko.
“Last year we had 3 million [passengers], up from 2.5 million the year before,” he told The Irrawaddy. The airport last received a major upgrade in 2003, with the current international terminal built by Asia World, which is run by Law, the sanctioned businessman.
Law’s father and Asia World founder, a long-time narcotics trafficker nicknamed the “Godfather of Heroin,” Lo Hsing Han, died last weekend in Rangoon.
The main objective of the proposed Rangoon upgrade is to improve the somewhat run-down domestic terminal, says the DCA. Last year 1.1 of the 3 million passengers transiting the airport were on domestic flights, according to airport statistics.
Two companies, Mitsubishi and Vinci, which is also in for the Rangoon upgrade, are competing for the Mandalay airport job. The airport, about a 40-minute drive from the center of Burma’s second-biggest city, will be upgraded primarily to enable the facility to function as a logistics and cargo hub for central and northern Burma, positioned between the giant Indian and Chinese markets, according to Win Swe Tun.
All told, there are 41 airports across Burma, but only three are capable of handling 747-class aircraft, including the airports at Rangoon, Mandalay and the capital Naypyidaw. Seven domestic and 23 foreign carriers offer domestic and international flights.
The airport renovation and construction plans have the support of Burma’s main opposition party, the National League for Democracy (NLD), with spokesman Nyan Win saying that Rangoon’s international airport was too small. “For handling international flights, we need more capacity,” he told The Irrawaddy.