Dubai goes slow on new airport to refinance existing aviation projects

0
1199
Spread the love
al maktoum international airport
Al Maktoum International Airport will have the capacity to handle 12 million tonnes of annual cargo capacity and 120 million passengers. Photo - DWC.ae

Dubai has decided to slow down the progress of the new Al Maktoum Airport in order to focus more on developing the existing Dubai International Airport, a Reuters report revealed Wednesday.

This decision has been taken by the authorities due to global economic recession and to focus on accessing the financial markets.

“They are going to come up with a structure that will enable us to access the financial market in the most cost-effective way, which we’ve not been able to do as a purely government-owned department,” Dubai Airports Chief Executive Paul Griffiths told Reuters in an interview.

NEW AIRPORT

The development of Al Maktoum Airport is estimated to cost $34 billion, making it the largest passenger and cargo hub in the world. It is estimated to be 10 times larger than the Dubai International Airport and Dubai Cargo Village combined.

Named after Sheikh Maktoum bin Rashid Al Maktoum, the late ruler of Dubai, it will serve as the main part of Dubai World Central and will comprise of large scale residential, commercial and logistics complexes.

The airport will have an annual cargo capacity of 12 million tons (thrice the world’s largest cargo hub today – Memphis International Airport) and passenger capacity of up to 150 million an year which is much more than the busiest airport in the world today – Atlanta International Airport.

The design of the airport is such that it will be able to handle all next generation aircrafts including the super jumbo Airbus A380 – a double decked, wide body, 4 engine jet airliner. The airport complex will be operational 24 hours a day and up to 4 super jumbo aircraft would be able to land simultaneously minimising air traffic.

ORIGINAL PLANS

Dubai Airports CEO explained that the original plan had been to move Emirates airlines in one go by creating enough infrastructure at Dubai World Central. He admitted that with every passing delay, the new capacity requirement is increasing, making it more difficult to relocate.

“We thought it would be better to push forward with a big expansion programme here which would meet their needs in a much more timely and cost effective manner, leaving the big push for DWC for a bit later, when there’s more cash around and we’re trading more profitably as a business,” he said.

“You can’t force airlines to do things that are not in their commercial interest – that’s not the ethos on which Dubai built its aviation sector. If there’s demand we will respond to demand … there is no point in investing money in places where there is no demand,” he insisted.

Aviation experts believe the development of this airport will no doubt increase Dubai’s business potential in the future.

In an interview with Gulf News last year, Mohammad Al Mua’allem, Senior Vice-President and Managing Director of DP World, said that the corridor between the Jebel Ali port and the Al Maktoum airport will allow the goods to be transferred from ships to planes within 40 minutes adding that this would be further reduced in near future.

“Hopefully by the middle or end of this year we hope to be able to declare it fit for purpose. But whether we actually start to put passenger operations through it is something we are still considering at the moment,” said Griffiths, who has run Dubai Airports since 2007.

“While there is space still at Dubai International there clearly isn’t a huge amount of interest in passenger operations at DWC and it’s not something we’re pushing hard at the moment because cargo is the big focus,” he added.

EXISTING AIRPORT

Over 50 million passengers pass through the Dubai International Airport each year and an $8billion plan is in place to get the Dubai International Airport the expansion it needs to meet near future challenges.

Authorities of the existing airport insist it would prove more cost effective and timely to expand Dubai International, and waiting till the global economy picks up pace which will put Al Maktoum Airport on the map once again.

Reuters said plans are in place to raise funds by selling debts based on future revenues from Dubai Duty Free, one of the world’s largest airport retailers.

Griffiths believes the world is a “very challenging place” at the moment to raise finances, but insisted that Dubai Airports’ record on growth and its firm expansion plans would help.

“I’d imagine we’re in a fairly good place as a blue-chip utility if we were in a structure that would enable us direct access into the market.”

One of the developments that the Dubai International Airport maybe looking at is to employ high-tech systems in order to reduce the long queues on passport controls – The National reported Tuesday based on an interview with Jill Nealon, senior vice-president of HR and development at Dubai Airports.

She also revealed that the airport is constructing the world’s first concourse to handle Airbus A380, which would without doubt increase the footfall at the airport and offer tremendous shopping experiences for the passengers. They are hoping to bring back the reason for passengers to come to Dubai, even if it’s only through transit, to experience the new and improved Dubai Duty Free and the other facilities that the airport has to offer.

(Written by Pulakshi Arunachalam with input from Reuters; Edited by Moign Khawaja)

Facebook Comments