Table Of ContentDEVELOPING STRATEGIES FOR THE MODERN
INTERNATIONAL AIRPORT
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Developing Strategies for the
Modern International Airport
East Asia and Beyond
ALAN WILLIAMS
Massey University, New Zealand
© Alan Williams 2006
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system
or transmitted in any form or by any means, electronic, mechanical, photocopying, recording
or otherwise without the prior permission of the publisher.
Alan Williams has asserted his right under the Copyright, Designs and Patents Act, 1988, to
be identifi ed as the author of this work.
Published by
Ashgate Publishing Limited Ashgate Publishing Company
Gower House Suite 420
Croft Road 101 Cherry Street
Aldershot Burlington, VT 05401-4405
Hampshire GU11 3HR USA
England
Ashgate website: http://www.ashgate.com
British Library Cataloguing in Publication Data
Williams, Alan
Developing strategies for the modern international airport
: East Asia and beyond
1.Airports - Economic aspects - East Asia
I.Title
387.7'36'095
Library of Congress Cataloging-in-Publication Data
Williams, Alan, 1934-
Developing strategies for the modern international airport : East Asia and beyond /
by Alan Williams.
p. cm.
Includes bibliographical references and index.
ISBN 0-7546-4445-6
1. Airports--Design and construction. I. Title.
TL725.W55 2006
387.7'36--dc22
2006000086
ISBN-10: 0 7546 4445 6
Printed and bound in Great Britain by Antony Rowe Ltd, Chippenham, Wiltshire.
Contents
List of Figures vi
List of Tables vii
Preface viii
Acknowledgements x
Introduction xi
1. The Changing Role of the International Airport in the Global Economy 1
2. Structural Changes in International Business: Implications
for the Airport Industry 19
3. Some Impacts of Deregulation on International Airport Development 33
4. The Infl uence of Geopolitical Factors on Major East Asian Hubs 45
5. Urbanization in East Asia: Its Impact on the Major Regional Airports 59
6. Forces Shaping a Multi-modal Future for ASEAN Airports 75
7. Political and Market Issues Confronting East Asian International Airports 91
8. The Future for East Asian Airports: A Speculative View
of Emerging Problems 105
9. Refl ections on the Future of International Airports in East Asia 123
Bibliography 135
Index 145
List of Figures
Figure 1.1 Porter’s fi ve forces theory applied to the aviation industry 16
Figure 2.1 National fl ag carriers located at the major East Asian airports 24
Figure 2.2 International examples of an airline within an airline 30
Figure 2.3 Types of commercial agreements involving strategic alliances 30
Figure 3.1 Limitations on new market entrants seeking route entry under
Europe’s open skies legislation 38
Figure 3.2 ICAO’s proposals for the evolution of market deregulation in
national aviation industries 40
Figure 3.3 The range of options for managerial control of international
airports 43
Figure 4.1 The deepening and widening of ASEAN FTAs 52
Figure 4.2 Variations in the role and purpose of FTAs 52
Figure 4.3 The terms of the MALIAT 55
Figure 5.1 The peri-urbanization process 61
Figure 5.2 The sub-regions of East Asia 63
Figure 5.3 The conceptual forms of activities in an airport city 69
Figure 5.4 International airport competitive advantage using the Porter fi ve
forces model 73
Figure 6.1 The location of activities relative to the airport 79
Figure 6.2 The four infrastructures of the GTP 81
Figure 6.3 The future strategic functions of the GTP: The Zhuhai model 82
Figure 6.4 The pattern of orientation and accessibility 85
Figure 6.5 Estimates of employment vacancies in Asia-Pacifi c, 2005–09 88
Figure 7.1 Benchmark requirements for effective PSP controls over FDI 93
Figure 7.2 The normative conditions limiting FDI in civil aviation 95
Figure 8.1 Singapore International Airlines: Premium services 118
Figure 8.2 Types of non-standard international business assignments 119
Figure 8.3 The membership of the EAAA 121
Figure 9.1 The characteristics of the worldwide air transport network 129
Figure 9.2 The ultimate objective of APEC’s policy objectives 130
List of Tables
Table 4.1 The reluctance of ASEAN-5 countries to seek an open skies
arrangement 50
Table 5.1 The distribution of urban growth, 2000–30 64
Table 6.1 The economic performance of Asian cargo airports in 2004 79
Table 6.2 Availability of paved runways at East Asian airports 86
Table 8.1 The operational distribution of LCCs in Asia 116
Preface
This book may be described as an attempt to identify and analyse some of the
complex issues and problems now being faced by modern international airports,
which are destined to have a fundamental infl uence on their future strategic goals
and operational functions. The need to respond in a proactive way to quite profound
economic challenges driven by the internationalization of the global economy
emerged during the latter part of the twentieth century and continues to grow apace.
It is driven by the fact that the economic geography of world commerce and trade
is itself changing direction, in a multitude of ways. These changes bring in their
train the need to address the identifi cation of the major future role of transportation
systems. With structural shifts taking place in the demographics of urbanization,
regionalization and new market development, urgent attention to such matters as
congestion and environmental impacts, is also high on the international agenda.
As a consequence the predominant emphasis throughout this book will be on the
economic and geopolitical infl uences that are currently shaping the role of the
international airport, both nationally and in the much larger contexts of urbanization
and globalization.
It is also very important that airport managements are made aware, and are
able to respond in an appropriate and strategic way, to the fact that there are strong
pressures being exerted by geopolitical, multinational business and environmental
constituencies. They, in turn, tend to see international airports as instruments of some
larger economic and social purpose, a situation that leads inevitably to confl icts
of interest, with the airports themselves caught sometimes between competing
agendas.
The basic approach to these questions will refl ect the author’s professional
background as an academic trained in political economy and management. This means
that the approach to the themes and topics in the book will be multi-disciplinary.
At the same time, attention will be given to the central issue of transport systems
as developmental tools, which leads, in turn, to a consideration of the functional
roles airports now play in the macro planning of development policies by national
governments.
A further assumption will shape both the themes and the context of discussion in
the following chapters. It will suggest that international airports already play a very
signifi cant and strategic role within the total development of the world’s economies,
infl uenced both by the economic values of their location and by the growing infl uence
of multinational businesses.
Any attempt to cover the airport industry as an international totality would require
a multi-volume series. As a matter of personal choice, therefore, it has been decided
to address the issues through the study of a specifi c geographical region, namely
Preface ix
East Asia, which contains a balance of both developed and developing economies.
This choice recognizes the growing importance of regional studies, as national
states joining free trade areas try to take advantage of their economic geography
and bilateral trade agreements, in turn, have become a favoured geopolitical activity
of G-8 and Organisation for Economic Co-operation and Development (OECD)
member states. This is especially true in aviation, given the growing signifi cance of
the region as a major market for aviation services.
In sum, the book will be devoted to the effects of change upon the modern
international airport within the East Asian region. It has been partly selected because
the author has some working familiarity with most of the states including China. The
choice has also been shaped by the fact that the selected location is becoming one of
the busiest in the world for air transport services.
I have also been strongly infl uenced by the fact that my academic and managerial
consulting experiences in various East and Southeast Asia countries have actually
permitted the practical observation of the growing strategic importance of airports
as both national and international hubs. It has also been shaped by the fortuitous
consequences of a post-retirement appointment to my University’s School of
Aviation, which now requires me to take both teach and accept formal responsibility
for graduate work in strategic airport development and management.
The book attempts to build on the work of many scholars who are concerned that
due cognisance must be taken of the ways in which political, geographical, social,
developmental and economic factors move and shape, and in turn infl uence, strategic
managerial and commercial outcomes. It remains to note that the study constitutes
an initial exploration of ideas, in the manner of a reconnaissance, of the issues, rather
than a fi nal attempt to judge the profound nature of the changes taking place.
