A ‘Pearl River Delta’ in PHL

With the continued robust tourism growth, plus the desire of Philippine conglomerates to build and upgrade existing airports, the country is now staring at its own “Pearl River Delta” (PRD) shaping up on the horizon.

The PRD is the Asian region’s busiest air-traffic environment. It consists of a multi-airports system, which includes five major airports: Guangzhou New Baiyun International Airport, Hong Kong’s Chek Lap Kok International Airport, Macau International Airport, Shenzhen Baoan International Airport and Zhuhai Airport.

These airports vary in sizes and business models. All of them, especially Guangzhou, Hong Kong and Shenzhen, have been facing serious capacity constraint and congestion in recent years.

That is why many flights from the Philippines to Hong Kong are experiencing so much delays because China has designated only a single entry point called “Noman” to get access to China’s airspace.

Gazing into the future with his aviation crystal ball, Air Asia Philippines (AirAsia) CEO Capt. Dexter Comendador said this scenario of serious traffic congestion within the terminal maneuvering area (TMA) of Manila is also fast shaping up.

“There are four airports now within the terminal maneuvering area of Manila, which, in itself, is a problem of air-traffic control [ATC],” Comendador noted.

“Naia and Sangley [Sangley Airport in Cavite] are within 60 miles of the TMA. Including Clark, Basa [an Air Force base in Pampanga] and Subic. That’s already congested, ” he said.

“Add the sixth, [the proposed airport in] San Miguel, Bulacan, that’s the same as the Pearl River Delta that the Civil Aviation Authority of the Philippines [CAAP] is worried about. It’s not me, it’s their worry, the controllers’ nightmare,” Comendador stated in an exclusive interview with the BusinessMirror.

This is why even if the Ninoy Aquino International Airport (Naia) planned upgrade would push through, the premier gateway would still have to deal with a highly congested airspace.

The congestion, according Comendador, is the airline’s basis to head for Clark in Pampanga, where the carrier intends to establish a hub for its operations.

Comendador stressed that in one way or another, the proposal forwarded by various private entities wanting to upgrade the Naia, or develop a new alternate airport in Bulacan, Sangley, Clark and Subic, would be realized, maybe in a few decades from now.

The BusinessMirror likewise queried Philippine Airlines (PAL) about its future plans.

“PAL is the original airline here, we will remain at the Ninoy Aquino International Airport,” PAL spokesman Cielo Villaluna said.

PAL, she added, has the option to remain at the premier airport, because since the beginning of commercial airline operations in the Philippines, PAL has been at the forefront and at the leading edge of airline progress in the country.

But House Speaker Pantaleon D. Alvarez has enough of the complaints coming from passengers on the congestion at Naia, so he directed the regulators and the airlines to come up with their flight-reassignment plans, including the transfer of some domestic flight operations to Clark within six months.

Immediately CebGo President and CEO Alexander G. Lao expressed the airlines’ reservations regarding the Manila International Airport Authority’s terminal reassignment plan, saying that moving Cebu Pacific’s domestic flights would add up to 16.6 million passengers in Terminal 2, which is more than its 9-million passenger capacity.

He also reiterated an earlier position that Cebu Pacific, which operates in Terminal 3, would need at least one year to transfer its operations and flights to other Naia terminals and the Clark airport.

Sen. Grace Poe allowed CebGo more time to study the transfer to Clark carefully.

The senator was also cautious on the planned transfer of some domestic flights to Clark airport, saying that the government still needs to address the connectivity issues between the Pampanga airport and Metro Manila.

“We still have to broaden the study and the plans for Clark. So it’s not yet ready because of the number of domestic flights and the connectivity from Clark to Metro Manila,” the lady lawmaker said.

Here is a preview of all of these airports that are being eyed for development.

Seven Philippine conglomerates have formally submitted to the Department of Transportation (DOTr) a proposal to transform the Naia into a regional hub at a cost of up to P350 billion.

The seven conglomerates are Aboitiz InfraCapital Inc., AC Infrastructure Holdings Corp., Alliance Global Group Inc., Asia’s Emerging Dragon Corp., Filinvest Development Corp., JG Summit Holdings Inc. and Metro Pacific Investments Corp.

Tagged as the Naia Consortium or “super consortium,” the seven firms said they have also appointed Changi International Airport as their technical partner in the rehabilitation of Naia.

Next is San Miguel Corp.’s P700-billion proposal to build, operate and maintain an airport in Bulacan. The food-and-beverage conglomerate proposed a new international “aerotropolis” that will involve an airport covering 1,168 hectares and a city complex to be built at a 2,500-hectare area along Manila Bay in Bulacan, Bulacan.

The 50-year airport project will entail building six parallel runways and an initial annual capacity of 100 million passengers, or three times more than Naia.

The Sangley Airport development was proposed by a consortium composed of Solar Group’s Wilson Y. Tieng and tycoon Henry T. Sy Sr. The group has submitted to the government its unsolicited proposal for a $12-billion Sangley Airport Infrastructure Group Inc., led by All-Asia Resources and Reclamation Corp. and Belle Corp. The group said it is proposing to build a new regional airport hub at Sangley that can accommodate about 120 million passengers annually once fully developed.

Under its proposal, the Philippine Sangley International Airport (PSIA) wants the development of the airport component pegged at around $12 billion, and involves a concession period of 50 years.

The project will start with the reclamation of about 2,500 hectares of land north of the Sangley peninsula to be used for the development of airport infrastructure and a commercial establishment. The plan also includes the development of airside and landside facilities and transportation infrastructure.

On the other hand, a consortium led by Megawide Construction Corp. and India’s GMR Infrastructure had bagged a contract to build a new passenger terminal at the Clark International Airport.

The consortium offered to build the facility “at the least cost to the government,” which had set the ceiling price for the new terminal that could accommodate eight million passengers per year at P12.55 billion.

“In five, 10 or maybe 15 years, all of these airports would become a reality, and unless Sangley Airport remains a general aviation airport, it would contribute to the congestion of the six airports which are all within a 60-kilometer radius,”Comendador said.

“But for us, following the idea of Art [Transportation Secretary Arthur Tugade] and President Duterte’s wish to develop Clark as a sister airport, we’re moving toward that direction by trying to create our own hub at Clark.”

He said it is Air Asia’s view that they can develop Clark as a sister airport once the North Luzon Expressway and the South Luzon Expressway connector road is finished. This includes the Metro Rail Transport.

“We will try to keep our fares lower than what the Manila hub can offer, so people will go there [in Clark],” Comendador said.

In the interview, the BusinessMirror pointed out that Clark still lacks the infrastructure, like a parallel, twin runway and bonded warehouses.

However, Comendador said that at the moment, Clark’s utilization is low, “we can use a single runway at the moment but the long-term plan is for three runways.”

The BusinessMirror also pointed out that even if the government starts building the infrastructure now, it would take 10 years or more to get them on stream.

“Clark utilization is not yet maxed out, we can still use the present runway,” Comendador stated.

“That’s where Air Asia is good at,” he continued. “We try to create a market. We hope by creating Clark as a sister airport, by offering good service and lower fare than what Manila can offer, some might look at it and try.”

Comendador said that is why they put up the Digital Nomad, a Red Hub convention the air carrier had established, which aims to create a community for digital nomads.

This way, Air Asia hopes to capture more “digital nomads,” a term used to describe tech-savvy workers with no permanent offices, as it increases its network in Southeast Asia.

Comendador said the company’s plan to expand its network across the Asean would mean seamless movement for frequent travelers.

“We are trying to complete the network of Asean by opening up [routes to] Jakarta [and] Bali. Those are the only routes that we lacked in. The Bangkok [route], we will open next month, so we have almost completed the whole of Asean,” he said.

Air Asia Philippines has started flights from Manila to Bali and Jakarta in January, and has started its Manila-Bangkok flights on April 22. Through the Jakarta route, Comendador said, digital nomads would be connected to the emerging start-up hubs in the Southern Asean region.

“We would like that the people working for AirAsia be able to travel around Asia and work while they’re traveling,” he said.

With its expansion plans, Air Asia expects more digital nomads, particularly from Western countries, to flock to the Asean region.

Air Asia also looks to capitalize on the “work from anywhere” trend.

“Asean [in a sense] has become smaller now so they [digital nomads] move around [the region], working [and] producing good outputs,” Comendador said.

He added: “Digital nomads are the young generation that work outside the office like bloggers, they go to places where they blog, they prepare, take photos, then send [their outputs] via the web, so they fly, they travel, there are lots of digital nomad with big salaries, they stay in Asia, they go around and work.”

Comendador said Air Asia is trying to create that niche for them “to be able to move around, especially in Asia were 40 percent of aviation progress [is projected to] happen in the next 20 years.”

“There are 22,000 airplanes ordered from Airbus for the next 20 years, and 40 percent will be in the Asia-Pacific region. This is where growth is taking place and air fares and accommodations are cheap.”

Comendador said Air Asia gives digital nomads “that opportunity, providing best connections in Asean. We are the only one authorized to put the Asean logo, we’re at the forefront of Asean integration.”

And where would Comendador see Air Asia in the next 20 years from now? “By that time we’ll [be able to] say, ‘Ah, you can travel around the world with Air Asia.’”

Borrowing a quote from Air Asia Group CEO and AirAsia X Co. Group CEO, Tony Fernandes, Comendador said: “Next time [around],we should be able to say, with Air Asia, you can go around.”

Image Credits: Dovidovich | Dreamstime.com

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Recto L. Mercene, graduate BS Journalism, Lyceum of the Philippines. First prize winner, News Photojournalism, by Confederation of Asean Journalists, Bangkok, Thailand; second prize winner, Art and Photojournalism Award; San Miguel Corporation. Former Air Traffic Controller and private pilot. Colombo scholarship grantee: Hurn College of Air Traffic Control, Bournemouth, United Kingdom.

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