Vietnam Needs to Build Airports for Budget Airlines

from the VIETNAM NEWS BRIEFS, April 24, 2007 Vietnam needs to build specific airports for low cost carriers, as the development of budget airlines should be seen as a key factor in the county's aviation industry and tourism development, said Tassapon Bijleveld, Chief Executive Officer of Thai AirAsia, which provides daily flights on the Bangkok - Hanoi route. This is very important as regional low cost carriers are booming in the country, including Pacific Airlines, he added. Budget airlines have said operation expenses in traditional airports make their operation costs too high. Thus, it is necessary for Vietnam to have airports for these firms to help them cut operation costs. Tassapon also added that investment into low cost airports would only show its effectiveness when the local Government pledged to liberalize the aviation market to offer flight commercial freedom more for foreign airlines

Presently, only several low cost air carriers are allowed to provide low cost flights to Hanoi and Ho Chi Minh at a low frequency

The State Capital Investment Corporation (SCIC) is waiting the Prime Minister's approval for its project to upgrade Gia Lam airport into one specifically designed to serve domestic and regional low cost flights and air taxis. The Government is still considering the mode of investment. SCIC suggested the Government should raise funds from enterprises and the public, both domestic and foreign sources, instead of investing with state-sourced capital. Meanwhile, experts said it would be more effective to mobilize funds from institutional and individual investors, which would ensure the effectiveness of the projects as they would be put under the strict supervision of investors

The Government estimated that by 2015, Vietnam will need 24 airports, including six international airports. Some $6 billion will be spent to renew or upgrade existing airports. Of this amount, the Government can only provide 20%; the rest will have to come from outside sources. (Vietnamnet Apr 23, Youth) Copyright 2007 Vietnam News Briefs

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