Skyrocketing Passengers Traffic Forces Vietnam to Urgently Upgrade Airports

Hanoi Noi Bai will see investment to increase its capacity

Vietnam is due to pour VND 6.050 billion (equivalent to US$268 million) into upgrading its major airports this year, state-owned Airports Corporation of Vietnam said on Monday.

Of that money, 88 million U.S. dollars has been earmarked for expanding the international terminal of Tan Son Nhat airport in Ho Chi Minh City, and 53 million U.S. dollars for upgrading Noi Bai international airport in Hanoi capital.

Than Son Nhat airport in Saigon is in urgent need for expansion as air passengers traffic is skyrocketing in the Southern Vietnam metropolis. Originally designed to handle 25 million passengers a year, the overcrowded airport welcomed in 2016 over 32.5 million passengers, up 22.4% over 2015.

The airport manager said the currently strained airport will have its aircraft parking area and international terminal expanded. With the Defense Ministry agreing to vacate some of the areas kept for military movements and maintenance, Tan Son Nhat International Airport will be able to add a runway, two terminals and extra aircraft parking to upgrade capacity for a traffic estimated at 40 to 50 million passengers annually. A first terminal will raise capacity to 38 million passengers by 2019, which is likely to be insufficient to cope with traffic. They are also plans to upgrade roads around the airport as clogged streets are turning into a permanent feature around the airport.

All expansion works are seen as ‘temporary measures’ until the future Long Thanh International Airport takes over part of the traffic from the current airport.

The future airport, which will have a capacity for 100 million passengers upon completion by 2050, is estimated to cost more than US$16 billion and is build in three phases. Due to financial constraints from the Vietnamese government, construction has already been delayed by three years. Long Thanh first phase is not expected to be completed before 2025 and would only offer a total passengers’ capacity for 25 million passengers for a total investment of US$6.7 billion.

Another 88 million U.S. dollars will be used to expand the passengers’ terminal of Phu Quoc international airport in southern Kien Giang province, to boost capacity to an annual output of five million passengers.

The expansion program was presented by the newly elected Chairman of the Board of the Airports Corporation of Vietnam (ACV), Lai Xuan Thanh. Thanh is a well-known figure in aviation circles as he is head of the Civil Aviation Authority of Vietnam (CAAV) since 2012.

ACV operates 22 airports throughout Vietnam, of which nine are international and 13 are domestic.

The new chairman is calling for investment in more airports, to increase the number to 23 by 2020 and 25 by 2030. Thanh predicts that between 2017-2021, the corporation will see passenger volumes to grow by 14% on annual average. Airports’ revenue is due to increase annually by 8% and pre-tax profit by 3% during the 2017-2020 period.

Vietnam’s aviation industry transported 21.2 million international and domestic passengers in the first half of this year, seeing a year-on-year rise of 10%, according to the country’s General Statistics Office.

In the six-month period, over 5.2 million foreign visitors came to Vietnam by air, up 33%.

(Partial source: Xinhua)