Published: 9:30am, 10 Jan 2025

Competition from the likes of Incheon and Changi means Hong Kong needs new ideas to remain relevant as a global aviation hub

In the fiercely competitive post-pandemic aviation industry, Hong Kong International Airport (HKIA) faces mounting pressure to redefine its role in Asia's skies. It faces the question of whether it can maintain its status as Asia's leading gateway or be overshadowed by rivals such as South Korea's Incheon airport and Singapore's Changi Airport, which are rapidly improving their strengths in transit connectivity and passenger experience.

Asia's leading airports sustain the aviation sector. Hong Kong faces the dual task of staying ahead in a rapidly changing aviation landscape and addressing the pressing need for sustainable practices.

The city's presence in global air travel began in a time when its international airport was located in Kai Tak and photos of planes landing over the city skyline became famous. The opening of the new airport at Chek Lap Kok in 1998 positioned Hong Kong as Asia's premier gateway during an era of rapid economic growth.

The rise in global trade volatility in recent years has not dimmed HKIA's considerable potential. The airport continues to play a major role as the world's busiest air cargo hub. It handles more than 4.3 million tonnes of cargo each year, specialising in high-value products such as pharmaceuticals and electronics.

Hong Kong's importance as a cargo transport hub has stayed strong in spite of changes driven by geopolitical tensions and snarls in global supply chains. Collaborations with logistics companies such as the Cainiao Smart Logistics Network will further enhance HKIA's presence as a key player in supply chains oriented towards e-commerce. There has also been a surge in the number of passengers at HKIA. The airport handled 45.2 million passengers in the financial year ending March 31, 2024, representing a year-on-year increase of 264.5 per cent.

With connections to around 200 destinations around the world, HKIA is indisputably a primary international gateway. But maintaining its leading status in Asia demands innovative steps.

The most notable of these is the HK$141 billion (US$18 billion) three-runway system, which has been fully operational since November. This expansion is part of efforts to increase the airport's passenger capacity to 120 million passengers and 10 million tonnes of cargo annually by 2035. This is expected to help increase the number of direct jobs associated with HKIA to 123,000 and aid Hong Kong economic recovery from the Covid-19 pandemic.

Complementing the third runway is the Skycity development, a commercial project near the airport designed to enhance tourism and business opportunities and drive revenue streams beyond aviation. It combines areas for retail and entertainment while aiming to turn the airport into a lifestyle experience instead of merely a transit node. As part of the ambitious Airport City project, there are even plans for a 600-berth yacht club, a fish market to rival Tokyo's Tsukiji Fish Market and a large-scale storage facility for artworks.

The significance of HKIA can be seen in its integration with the Greater Bay Area, a region which generates more than 10 per cent of the country's GDP. This regional integration further cements Hong Kong's position as China's global hub and enhances access to expanded markets for regional businesses.

Despite these advancements, Hong Kong faces stiff competition. For example, Incheon International Airport has developed into a popular transit point for long-haul trips, especially for flights between North America and Asia.

With the completion of a fourth runway and expansion of its Terminal 2, the Incheon airport expects its annual passenger capacity to increase from 77 million to 160 million and annual cargo capacity to rise from 5 million to 6.3 million tonnes. The expanded terminal also includes a Smart Pass system which uses facial recognition technology to identify passengers, simplifying customs and security checks. In addition, last month's merger between Korean Air and Asiana Airlines will further develop Incheon's position as a global aviation hub.

The remarkable expansion in visitor services provided by Singapore's Changi Airport continues to serve as the benchmark. The airport's purpose has been transformed by the Jewel Changi complex which combines shopping, dining and entertainment into one space. Changi will remain Southeast Asia's leading hub owing to its capability to accommodate 140 million travellers per year, a capacity expected to be provided by the new Terminal 5 set to be operational by the mid-2030s.

Furthermore, Changi has shown creativity in aviation development technology by undertaking solar energy integration and building energy-efficient infrastructure. These are concrete sustainability efforts which help Changi stand out on the world stage.

These regional rivals offer both a challenge and an opportunity for HKIA. Maintaining its leadership will require it to evolve its thinking and remain relevant in a cutthroat environment. However, its primary challenge is finding ways to address critical issues while staying ahead of the pack. This starts by coming up with strategic measures on attracting tourists and business travellers to restore pre-pandemic passenger volumes.

HKIA must also address the increasing levels of international competitiveness in environmental matters as the aviation sector comes under pressure over its level of greenhouse gas emissions. Its aim to achieve net zero emissions by 2050 will take some hard work amid the need for investment in sustainable aviation fuel, renewable energy use and development of green technologies. Meeting these ambitious targets will require painstaking cooperation with aviation sector stakeholders.

Finally, it must explore new technologies. Artificial intelligence-powered cargo management systems, biometric passenger handling and green airport solutions can improve productivity and service delivery so HKIA remains responsive to global market shifts.

In a competitive and rapidly evolving global aviation sector, the future of HKIA will depend on its ability to lead, not follow.

https://www.scmp.com/opinion/hong-kong-opinion/article/3293752/how-hong-kong-can-retain-its-status-among-asias-leading-airports

From  Janghyuk LIM