Ready for business

Never has there been as much news about one infrastructure project than Suvarnabhumi Airport, Bangkok's new international aviation centre. Billed as the future aviation hub of Southeast Asia, it has long been a proposal that has shifted on and off the table of various governments for more than 40 years. Ground was first broken on the project on September 29, 2000 when a corner stone was laid by the King of Thailand. Six years later almost to the day, the airport is scheduled to open on September 28. The current Thaksin Shinawatra-led government did not approve the project (winning its first election in 2001), but to its credit it has forcefully and proactively pushed the project able to do so in the past. Thailand's development as a centre for commerce in Southeast Asia, with booming exports and a tourism sector that is the envy of the region, deserves nothing less. But the effort required to get to this stage has been nothing short of monumental, with accusations of corruption and lack of readiness still threatening to derail the airport's opening. Cynical opinions Everyone in the Thai CEI industry has an opinion on the project, with the more cynical suspecting the government of needing to push through what will stand as perhaps its greatest achievement on the eve of a general election on October 15. Many destination management companies were still hedging their bets at press time, keeping contingency plans in place in case they needed to continue using the existing international airport at Don Muang. However, successful test flights have been conducted at Suvarnabhumi since July 31 and the national carrier Thai Airways is in the process of a massive move of equipment from the existing airport. What is becoming increasingly evident is that, glitches or not, the new airport will open on September 28. However not all industry players are fully confident in this date. "The chances of a fully operating airport by the end of September are very small," Diethelm Travel Asia chief operations officer Richard Brower says. But he concedes that international travel partners will understand if the airport is not 100 per cent ready as there is general appreciation of the enormous size of the project. He also says the absolute readiness of the airport would not affect business in the long term. International airlines are also being enticed to use Suvarnabhumi as a regional aviation hub through lower landing and parking fees than at other airports in Asia. Airports Authority of Thailand (AoT) president Chotisak Asapaviriya says: "For a Boeing 747-400, the fees for Suvarnabhumi are US$1,795 compared to US$2,241 in Singapore, US$3,445 in Hong Kong and US$8,055 for Tokyo. There will be no more air-traffic congestion so carriers will make significant fuel savings due to shorter waiting times for take-offs and landings." Departure tax One issue concerning DMCs is the hike in departure tax from 500 baht (US$13.30) to 700 baht. Not only will this make Thailand more expensive, but time will continue to be wasted by visitors still having to queue up to make manual payment at the machines. Regional observers have criticised the system as archaic and one that does not exist in Hong Kong and Singapore, where departure tax is included in the airfare and collected by the airports separately. However, AoT says it has increased the tax to help pay for the extensive new facilities which are of benefit to all consumers. Transportation to and from the airport is also an issue as Suvarnabhumi is located 32km east of Bangkok. Ground handlers say the difference in cost between the two airports will be not that great and will be dictated more by the price of oil. Transfer times will also be only slightly longer. Destination Asia (Thailand) managing director Pornthip Samerton agrees. "There will be a slight increase due to the distance of the new airport, but it will not create that big an impact for CEI groups," she says. However Asian Trails deputy managing director Roger Haumueller says it will be difficult to predict transfer times into Bangkok. "I went to the new airport last week, it took me 35 minutes on a Saturday morning," he says. "It is difficult to predict the traffic situation until the airport is open." Rail link But the major transport issue is the completion of the 28km Airport Rail Link from Bangkok to Suvarnabhumi. Originally planned for completion in November 2007, there is a very real risk of the project being delayed for another year. The construction company in charge of the project, Sino-Thai, has complained of a reluctance on the part of the State Railway of Thailand to meet handover deadlines of planned construction areas as well as spiralling oil prices that have increased construction costs. This will not impact BITEC, which is by far the closest exhibition and convention facility to the airport among the major established players in Bangkok. BITEC is expecting to benefit substantially as a result of its newly convenient location — a reason chief executive officer Dr Prasarn Bhiraj Buri says it was built on the current site almost 10 years ago. On the other side of the airport along the eastern seaboard, Pattaya is undergoing a boom off the back of the new airport, described by Sofitel-managed Garden Cliff Resort & Spa Pattaya general manager Nicolas Lerat as "a huge support" to CEI business. The resort town has been undergoing a reversal in both fortunes and image of late. Several existing hotels have been upgraded and a new Sheraton has opened near the PEACH exhibition facility. Meanwhile, Hyatt, Hilton and Le Meridien are all due to open in the near future. With the number of business delegates to Thailand topping 600,000 in 2005 (up five per cent on 2004) and business tourism revenue reaching US$1.1 billion, or 12 per cent of total tourism receipts, Pattaya is well positioned to get a fair share of the spoils. Teething problems It will surprise no one if Suvarnabhumi Airport undergoes many of the teething problems that were also experienced by new regional airports in Kuala Lumpur and Hong Kong. The scale of this project is bigger than either of those two and little short of a magnificent feat of engineering. Suvarnabhumi will also boast numerous records, such as the world's largest control tower and Asia's largest passenger terminal. At a cost of US$4.1 billion, its initial passenger capacity will be 45 million (compared to 34 million at Hong Kong) and the airport will handle 76 flights per hour. A further two runways are planned for a future capacity of 100 million as is a second terminal for low-cost carriers (LCCs) and a dedicated terminal for domestic carriers. Despite the teething problems, Suvarnabhumi Airport will inevitably grow into an important aviation hub and be crucial in reaching the country's goal of being the business tourism centre of Southeast Asia.