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Privatization of airports in Asia

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  • Hooper, Paul

Abstract

It has been claimed that Asia lags behind the rest of the world in the privatization of airports. At the same time, the air transport sector has been growing quickly and this has placed enormous pressure on airport infrastructure. This paper reviews the situation and finds that the private sector is involved extensively with new airports and the upgrading of existing airports in Asia. Although the models used to accommodate the private sector appear similar to those used elsewhere, governments in Asia have retained majority control in every case. Despite the fact that some governments say that efficiency is important to them, the most common and important motive in “privatization†in Asia is to mobilize a new source of finance. Airports remain high on the agenda of public policy. Governments are concerned about abuse of monopoly powers and they want to cross-subsidize regional airports, but they lack the institutional strengths to regulate effectively. By retaining majority control, however, governments risk losing the efficiency benefits of privatization. The paper explores the reasons why airports are such difficult cases to deal with and concludes that there is a greater need than ever to be able to compare the performances of airports.

Suggested Citation

  • Hooper, Paul, 2002. "Privatization of airports in Asia," Journal of Air Transport Management, Elsevier, vol. 8(5), pages 289-300.
    • Handle: RePEc:eee:jaitra:v:8:y:2002:i:5:p:289-300
    DOI: 10.1016/S0969-6997(02)00009-1
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    References listed on IDEAS

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    Cited by:

    1. World Bank, 2009. "The Service Revolution in South Asia," World Bank Publications - Reports 19332, The World Bank Group.
    2. Xiaowen Fu & Mark Lijesen & Tae H. Oum, 2006. "An Analysis of Airport Pricing and Regulation in the Presence of Competition Between Full Service Airlines and Low Cost Carriers," Journal of Transport Economics and Policy, University of Bath, vol. 40(3), pages 425-447, September.
    3. Lyon, David & Francis, Graham, 2006. "Managing New Zealand's airports in the face of commercial challenges," Journal of Air Transport Management, Elsevier, vol. 12(5), pages 220-226.
    4. Roberto Rendeiro Martín-Cejas & Pedro González de la Fe & Beatriz Tovar, 2008. "Impacto del sector privado en la eficiencia de los aeropuertos españoles," Economic Reports 07-08, FEDEA.
    5. Oum, Tae H. & Adler, Nicole & Yu, Chunyan, 2006. "Privatization, Corporatization, Ownership Forms and their Effects on the Performance of the World’s Major Airports," 47th Annual Transportation Research Forum, New York, New York, March 23-25, 2006 208026, Transportation Research Forum.
    6. Antwi, Collins Opoku & Fan, Chong-jun & Nataliia, Ihnatushchenko & Aboagye, Michael Osei & Xu, Hangyu & Azamela, John Coffie, 2020. "Do airport staff helpfulness and communication generate behavioral loyalty in transfer passengers? A conditional mediation analysis," Journal of Retailing and Consumer Services, Elsevier, vol. 54(C).
    7. Yang, Xiuyun & Keat Tok, Sow & Su, Fang, 2008. "The privatization and commercialization of China's airports," Journal of Air Transport Management, Elsevier, vol. 14(5), pages 243-251.
    8. Martimort, David & Pommey, Guillaume & Pouyet, Jerome, 2022. "Optimal regulation design of airports: Investment incentives and impact of commercial services," Transportation Research Part B: Methodological, Elsevier, vol. 164(C), pages 25-44.
    9. Gong, Stephen X.H. & Cullinane, Kevin & Firth, Michael, 2012. "The impact of airport and seaport privatization on efficiency and performance: A review of the international evidence and implications for developing countries," Transport Policy, Elsevier, vol. 24(C), pages 37-47.
    10. Muslim, Syed Askari & Ahmad, Yasir & Abbas, Shahbaz, 2024. "Is it worthwhile to manage airport efficiency through privatization in a developing country? A case study of Pakistani airports," Journal of Air Transport Management, Elsevier, vol. 115(C).
    11. Chen, Zhongfei & Barros, Carlos & Yu, Yanni, 2017. "Spatial distribution characteristic of Chinese airports: A spatial cost function approach," Journal of Air Transport Management, Elsevier, vol. 59(C), pages 63-70.
    12. Chaouk, Mohammed & Pagliari, Dr Romano & Moxon, Richard, 2020. "The impact of national macro-environment exogenous variables on airport efficiency," Journal of Air Transport Management, Elsevier, vol. 82(C).
    13. Carney, Michael & Mew, Keith, 2003. "Airport governance reform: a strategic management perspective," Journal of Air Transport Management, Elsevier, vol. 9(4), pages 221-232.
    14. David Martimort & Guillaume Pommey & Jerome Pouyet, 2021. "How to Regulate Airports?," Working Papers hal-03328394, HAL.
    15. Yu, Ming-Miin & Rakshit, Ipsita, 2023. "Assessing the dynamic efficiency and technology gap of airports under different ownerships: A union dynamic NDEA approach," Omega, Elsevier, vol. 119(C).
    16. Kan Tsui, Wai Hong & Balli, Hatice Ozer & Gilbey, Andrew & Gow, Hamish, 2014. "Operational efficiency of Asia–Pacific airports," Journal of Air Transport Management, Elsevier, vol. 40(C), pages 16-24.
    17. Manuj Ohri, 2012. "Discussion Paper: Airport Privatization in India," Networks and Spatial Economics, Springer, vol. 12(2), pages 279-297, June.
    18. Torres, E. & Domínguez, J.S. & Valdés, L. & Aza, R., 2005. "Passenger waiting time in an airport and expenditure carried out in the commercial area," Journal of Air Transport Management, Elsevier, vol. 11(6), pages 363-367.
    19. Oum, Tae H. & Adler, Nicole & Yu, Chunyan, 2006. "Privatization, corporatization, ownership forms and their effects on the performance of the world's major airports," Journal of Air Transport Management, Elsevier, vol. 12(3), pages 109-121.
    20. lo Storto, Corrado, 2018. "Ownership structure and the technical, cost, and revenue efficiency of Italian airports," Utilities Policy, Elsevier, vol. 50(C), pages 175-193.
    21. Abbruzzo, Antonino & Fasone, Vincenzo & Scuderi, Raffaele, 2016. "Operational and financial performance of Italian airport companies: A dynamic graphical model," Transport Policy, Elsevier, vol. 52(C), pages 231-237.

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