Taiwan's air hub plans take flight as better mainland China ties bring in more tourists

Approval given for mega aviation centre as better cross-strait ties bring in the tourists

PUBLISHED : Monday, 24 February, 2014, 3:45am
UPDATED : Monday, 24 February, 2014, 3:45am


Taiwan's ambitions to become a regional air hub finally look set to take off after it received approval to build a mega "aerotropolis" to cash in on improving ties with the mainland and the rise of budget airlines in the region.

The plan to transform Taipei's Taoyuan International Airport into a regional aviation centre is tipped to attract more than US$16 billion in investment for the island's biggest infrastructure project in more than 30 years. Covering nearly 7,000 hectares, the "aerotropolis" will have a free-trade zone, a third airport terminal and an industrial park to house goods-distribution and aviation-related industries.

First mooted in the 1990s by the then Kuomintang government, the project stalled after elections in 2000 when the Democratic Progressive Party ended the KMT's 51-year grip on power. With the KMT now back in power and the economy faltering, President Ma Ying-jeou revived the project in his 2008 re-election campaign.

Since then, government agencies have been working out the details of the mammoth undertaking that could generate more than 200,000 jobs. The project is now set to take off from the drawing board after the interior ministry recently gave the nod to its urban development plans.

"The approval … marks a major step forward in the development of the Taoyuan aerotropolis project," Wu Chih-yang, head of the Taoyuan county government, said.

Wu estimated that within the next 15 years, the government and private sector could pour up to NT$500 billion (HK$1.27 trillion) into the project and that up to 260,000 jobs would be created that could "help the economy get up and running again".

Critics and the opposition say the project is intended to help sway voters for mayoral elections in November, and the faltering economy has been the biggest source of mounting complaints against Ma's administration. Once one of Asia's most dynamic economies, Taiwan grew just 1.48 per cent in 2011, 2.11 per cent in 2012, and is predicted to rise 2.82 per cent this year.

Despite the economic gloom, the island has enjoyed a dramatic rise in tourist arrivals, thanks largely to improving ties with its former bitter rivals in the Communist Party in Beijing over the past few years.

The Taoyuan airport had its original terminal renovated last year as it could not cope with the increased passenger traffic, much of it from the mainland. A third runway is scheduled for completion by 2020. The airport is predicted to see its annual passenger capacity double to 60 million visits by 2030.

"Passenger load has seen double-digit growth in the past two years. This definitely had something to do with the improvement of cross-strait ties," Taoyuan Airport Corp spokesman Wen Yung-sung said.

The rise of budget airlines in the region also contributed to the tourist influx, bringing in more young travellers from Hong Kong, Singapore, Malaysia, the Philippines and Japan, Wen said. Foreign tourists made more than eight million visits to Taiwan last year, up from 3.84 million visits in 2008, figures showed

A record 2.85 million Chinese nationals visited the island last year, up 10 per cent from 2012, four years after a decades-old ban on mainland tourists was lifted. Taiwan also started admitting solo tourists in mid-2011.

Yet opponents have cast a shadow over the project, which requires the compulsory purchase of more than 3,000 hectares of land. "We doubt the local government has the ability to execute Taiwan's biggest-ever zone expropriation plan," Hsu Po-ren of the Taiwan Rural Front said, as many of the residents to be affected have pledged to stop the plans. About 8,000 households, or 30,000 people, would be displaced, he said.

But officials said they were handling the problem and that the bold aviation plan would go ahead. "We've increased staff to handle the thorny issues and stepped up communication with the opponents," the county government's Huang Sui-peng said.

"We believe the [opposition] noise can be reduced and we're optimistic about the progress of the project."