Vietnam parliament approves construction of huge hub airport

Construction News Vietnam

airport_doclDeputies of Vietnam’s National Assembly vote for the new Long Thanh airport project during a parliament session in Hanoi June 25, 2015. Vietnam plans to build an ambitious new $16-billion airport as an eventual competitor to sprawling airline hubs in Bangkok and Singapore, on a site that is bigger than both combined. Photo: Reuters

The National Assembly has given the green light for a US$15.8 billion airport outside Ho Chi Minh City, ending lingering debates on a controversial major project that has raised eyebrows over its raison d’être.

The lawmakers overwhelmingly passed a resolution Thursday allowing the government to forge ahead with construction on the

Long Thanh International Airport, touted as the country’s most ambitious infrastructure project yet.

Long Thanh is designed to handle 100 million passengers and five billion tons of goods a year after 2050. The government envisages it will eventually become a regional transit hub and rub shoulders with the famous airports in Hong Kong, Singapore and Bangkok.

The airport will be built in the southern province of Dong Nai, about 40 kilometers to the northeast of HCMC. Vietnam plans to build the airport in three separate phases with the first one slated to begin in 2018. The estimated cost of the first phase is $5.2 billion.

The second phase of Long Thanh would be built from 2030 to 2035, costing $4 billion. The third stage would run from 2040 to 2050, worth $6.6 billion, preliminary figures show.

When it goes into operation in 2025, Long Thanh will be able to serve 38 million passengers annually.

The country’s biggest airport, Tan Son Nhat in HCMC, has a designed capacity of 20 million passengers. Hanoi’s Noi Bai Airport opened a second terminal last year worth $900 million, nearly doubling its capacity to 22 million passengers.

Public debt concerns
Proponents of the project often say an advanced airport is quite important to Vietnam to bring the country on par with the world.

They had urged the National Assembly – Vietnam’s legislature – to approve the project soon and hash out differences on details and costs later.

But naysayers argue that construction of the airport is not that urgent, given Vietnam’s significant public debt.
These critics are concerned that the project could aggravate the financial quagmire of the country, where each of its 90 million people already bears a per capita public debt of some $900.

The idea of the airport was first mooted a decade ago aiming to lure large foreign interest in contracts from construction and technology to services and retail.

France’s Aeroports de Paris SA has already approached Vietnam’s government with a view to becoming a strategic partner with state-run Airports Corporation of Vietnam, Reuters quoted a Vietnam News Agency report in March.

The initial cost of the region’s newest hub, Bangkok’s Suvarnabhumi Airport, was $4.6 billion with annual capacity of 45 million passengers. Singapore’s Changi Airport plans to double yearly capacity to 130 million passengers in a decade, the newswire said.