Incheon emerges as role model for airports

A bird’s eye view of Incheon International Airport
Airport officials from 72 nations to gather in Seoul for annual meeting on May 26-28

By Lee Hyo-sik

Under the slogan of “Airport: Serving the Customer and the Community,” airport administrators, airline executives and other aviation experts from around the world will converge in Seoul early next week to attend an annual gathering. They will discuss a wide range of issues concerning airport management, security and service quality.

Choi Hong-yeol, acting president and CEO of Incheon International Airport Corp.Incheon International Airport Corp. (IIAC), which operates Korea’s main gateway to the world, will host the 2014 Airports Council International (ACI) Asia-Pacific/World Annual General Assembly at COEX in southern Seoul from May 26 to 28. More than 800 airport officials, corporate executives and scholars from 72 countries are expected to participate in the three-day meeting

In an interview with The Korea Times, IIAC acting president and CEO Choi Hong-yeol said the state-run company has made all the necessary preparations for a successful hosting of the meeting dubbed the “Global Airport Summit.” He said Incheon International Airport is ready to show the participants why it is the world’s most competitive and efficiently-operated airport.

“We are delighted to host the ACI Asia-Pacific/World Annual General Assembly in Seoul,” Choi said. “The upcoming gathering will be a perfect venue for the participants to learn about the latest airport industry trends and build business networks across the various industries involving airlines, duty free and logistics.”

ACI is the global trade representative of the world’s airports. Established in 1991, ACI is a non-profit organization whose prime purpose is to advance the interests of airports and to promote professional excellence in airport management and operations. It is headquartered in Montreal, Canada, and has 591 regular members operating 1,861 airports in 177 countries.

The interior of Incheon International Airport
Among other activities, ACI operates funds to finance training programs for airport administrators in developing nations, and assist airports in the developing world to upgrade their facilities. It has also been conducting an assessment on airport service quality since 1993, increasing the level of customer services at airports across the globe.

“We will hold a number of seminars to discuss how to promote ACI’s priorities and enlarge its role under the meeting’s slogan. The participants will also learn about the future trends of the airport industry and ways to boost operating efficiencies and safety,” the CEO said. “We will hold a gala dinner on May 27 at which Incheon Airport will receive an award for the ninth straight year as the best airport in ACI’s service quality survey.”

IIAC will also organize an airport industry exhibition in which over 60 companies will showcase their latest technologies and products

Choi said airports in the Asia-Pacific region have been growing at an explosive pace in recent years on the back of a surging number of travelers.

“The region has emerged as the world’s most promising market for airport operators. This makes the May 26 to 28 gathering in Seoul much more important for the global airport industry,” he said. “Through the meeting, we will make an all-out effort to let the participants know about Incheon Airport’s strengths. This will help us raise our global profile and make inroads into more foreign markets.”

In 2012, the airport, which opened in 2001, handled nearly 38 million passengers and 2.4 million tons of cargo, up 10 percent from a year earlier. It serves more than 90 carriers flying to and from 183 destinations overseas. It ranked ninth in the world for international passenger traffic and second in international cargo traffic.

Choi Hong-yeol, third from left, acting president and CEO of Incheon International Airport Corp. (IIAC), poses with Somboune Daosavanh, left, vice chief of Department of Civil Aviation of Laos, and Rishikesh Sharma, fifth from left, vice chief of the Civil Aviation Authority of Nepal, after signing a memorandum of understanding at the airport, Sept. 11, 2013. Under the agreement, IIAC’s academy will train 130 airport employees annually from the two Southeast Asian countries. / Courtesy of IIAC

Setting global standard

Thousands of industry experts and government officials from around the world have visited Incheon Airport over the past decade to learn about its construction and operation know-how.

“We went to Britain, Germany and Singapore to benchmark their airport operational knowhow when Korea opened Incheon Airport in 2001. But now, people from all over the world come to us to learn about how we operate,” Choi said. “Over 7,000 businesspeople, bureaucrats and other professionals from 70 countries have visited to benchmark Incheon Airport since its opening 14 years ago. In 2013 alone, a total of 568 people from 23 nations visited us.”

The CEO said many airports and international organizations have asked Incheon Airport to form a business partnership. “We will also actively seek to expand our presence abroad by signing strategic partnerships and building business networks with foreign airports. The upcoming ACI meeting will certainly help us achieve the goal.”

In addition, IIAC has been training employees of foreign airports at its academy since 2008. Nearly 2,400 people from 97 countries, including China, Mongolia, the Philippines and Vietnam, have completed one or many of the 119 IIAC-administered education programs. In particular, the company has offered free education to 529 airport workers from 75 developing nations.

In September 2013, IIAC signed a memorandum of understanding with the airport authorities of Nepal and Laos. Under the agreement, IIAC’s academy will train a total of 130 people annually from the two Southeast Asian countries. They are learning about how Korea constructed Incheon Airport, and how it functions and maintains safety.

“We are proud to train airport personnel from the developing world. They will return to their home countries and operate their airports more efficiently and safely,” the CEO said. “This effort will certainly help us raise our profile abroad and advance further into foreign markets.”

Overseas ventures

In 2007, IIAC decided to pursue overseas projects by turning its airport construction and operational expertise into a knowledge product and export it.

In February 2009, it dispatched 25 employees specializing in the six areas of information and communication, machinery and equipment, electricity, navigation equipment, rescue and firefighting to support test operations and actual management of Iraq’s Erbil Airport. The deal worth $31.5 million was completed in March this year.

In addition, IIAC signed a master service agreement with Russia’s Khabarovsk Airport. Under the accord, it prepared plans for the layout of airport facilities including demand forecast, runways, tarmac and duty free shops as well as a step-by-step construction plan.

In August 2010, it won a $1.05 million project set up by KOICA at the requestof Philippines’ Mactan Cebu International Airport.

Four months later, it also signed an information technology design, supervision and consulting service agreement with New Siem Reap International Airport in Cambodia, while winning a $3.1 million commercial consulting agreement with Indonesia’s AP1, which manages 13 airports in the Southeast Asian nation’s eastern region.

In all, IIAC has completed or has been working on 18 overseas projects, worth $71.2 million combined, in Iraq, the Philippines, Indonesia, Nepal, Bangladesh, Cambodia, Russia and India.

“We plan to advance our initial overseas projects focusing on short-term consulting services toward a more sophisticated investment development business model that will enable continuous long-term projects,” Choi said. IIAC also intends to gradually expand its scope of participation in projects.

While continuing commissioned operating projects, the company will focus more on built, operate and transfer (BOT) projects, acquire overseas airports and establish a subsidiary specializing in overseas projects, he said. “All of these efforts are part of Incheon Airport’s plan to build airports in various countries and turn itself into the world’s most advanced aviation hub.”

Expansion

In order to maintain an edge over its rivals in Singapore, Hong Kong, Shanghai and Tokyo, Incheon Airport plans to build more runways, passenger and cargo terminals, automated luggage handling systems and other facilities through 2017.

“We would like to complete our third-phase construction project before the 2018 PyeongChang Winter Olympics to handle more passengers and cargo. When it is completed, we will be in a better position to emerge as Northeast Asia’s leading hub,” Choi said.

The third-phase construction scheme valued at 5 trillion won will boost the capacity of Incheon Airport to handle 62 million passengers annually.

On top of airport-related facilities, hotels, resorts, casinos, convention centers and other urban infrastructure will be constructed near the airport, creating an international leisure and business center.

“We are looking for foreign investors interested in building resorts and other urban facilities on sites near Incheon Airport. The envisioned city will greatly help the airport become a global aviation hub,” the CEO said.

Incheon emerges as role model for airports