The crash-landing of Xiamen Air Flight MF8667 at 11:56 pm midnight of Aug. 16, 2018 brought into sharp relief the importance of airports to the Philippine economy and to our daily lives.
I had previously estimated the cost to the economy of the two-day closure of the Ninoy Aquino International Airport from midnight of Aug. 16, 2018 to Saturday noon, Aug. 20, 2018 at P3.7 billion. That figure is now grossly understated.
The economy produces goods and services (or Gross Domestic Product or GDP) at current prices amounting to P17 trillion. Aviation contributes 9 percent of that, or P1.53 trillion. Divide P1.53 trillion by 365 days and you get P4.19 billion. NAIA accounts for 60 percent of that or P2.5 billion per day. Multiply P2.5 billion by two days, you get P5 billion.
Yes, P5 billion is the country’s economic loss for two days in the aftermath of the XiamenAir disaster.
And yet, the Chinese airline was slapped a colossally huge amount of only P15 million! That is not even equivalent to a slap on the wrist for economic sabotage to the tune of P5 billion.
Party-list Rep. Gary Alejano, a former military man, tweeted wryly, “The Chinese now have gotten the idea on how easy it is to paralyze the PHL transpo.”
Anecdotal evidence now shows possibly more than 500,000 air passengers were affected or disrupted by the XiamenAir disaster, not 100,000 as estimated by the Naia GM Eddie Monreal.
Cebu Pacific informed me that some 200,000 of its domestic and international passengers had to rebook by themselves at the airline’s website. The carrier’s website saw increased activity of 100,000 visits daily after the accident.
For Aug. 17 to 20, Philippine Airlines reported 34,000 passengers affected—29,500 passengers of 87 canceled flights and 4,500 passengers of 21 diverted flights. Those are PAL passengers who were directly affected. They do not include hundreds of thousands more displaced by canceled flights, redirected flights, late flights, recovery flights.
The Philippines is an archipelago country, with no less than 7,300 islands, at low tide. You need aviation to connect the islands, their people, their social lives, their businesses.
Manila is four hours or less away from major Asian political and financial capitals—Tokyo, Beijing, Shanghai, Hong Kong, Singapore, Seoul, Taipei, Bangkok, Kuala Lumpur. Four of the world’s largest airports in passenger capacity are Asian—Beijing, Tokyo, Hong Kong, and Shanghai.
Whether you like it or not, Manila is a veritable regional and global hub. The Philippines, after all, is one of the world’s fastest-growing economies. It is also the 12th largest consumer market on earth. More than 100 million Chinese travel abroad yearly and they have recently taken to liking the Philippines making them Manila’s No. 1 tourists.
Per capita, Filipinos make more than $3,500 per year, making them middle class. Not poor. In 10 years, more than 30 million Filipinos came to fly for the first time.
Airports are the wave of the future. A city, in fact, a country cannot prosper without a serious airport. It is integral to tourism, today’s the world’s biggest business.
In the United States, in states where tourism is strong, civil aviation is a very important component of the economy. Civil aviation accounts for 18 percent of the GDP of Hawaii, 12 of Nevada, 7.9 of Arizona, 7.5 of Alaska, 7.2 of Florida, and 6.7 percent of Washington.
Hong Kong and Singapore as well as Qatar and UAE are basically aviation economies.
What to do, then, with NAIA?
Well, close it down. It is useless. Build a new airport.
That airport is should be the one proposed by San Miguel Corp., a $15-billion facility, 27 kilometers north of the 600-hectare NAIA, on 2,500 hectares of mostly flat lands.
Here are the main benefits of the SMC airport:
• It will increase in annual arrivals to 20 million
• It will generate at least 30 million in jobs
• The government won’t spend a centavo to build the airport. SMC will finance the whole $15 billion by itself using its enormous leverage power
• It will decongest Metro Manila. A new airport will revitalize Bulacan and all areas around it. SMC will build a sprawling industrial estate, a seaport, a spillway to ease flooding, and interconnecting highways and railways around the airport.
• It will improve the image of the Philippines. The mess at NAIA has done more to damage the country than all previous acts of terrorism combined
• It will improve Filipinos’ quality of life.
• It will contribute more than P1.5 trillion a year or 9 percent of the country’s GDP
• There will be fast and easy access via multiple expressways
• It will have substantial multiplier effects
• It will help solve Metro Manila’s horendous traffic which costs P3 billion daily
• It will bring enormous savings to the economy
• Traffic congestion at the 70-year-old NAIA will rise to P24.3 billion annually in losses in airline fuel and operating expenses. Losses will rise to P25.4 billion a year by 2050.
• Passenger losses in loss of productivity are P30 billion annually by 2040 due to flight delays at NAIA. Losses rise to P32 billion annually by 2050.
RSA promises to solve Bulacan’s perennial flooding problem with spillway excess water from Angat and Ipo dam watersheds to drain directly into Manila Bay.