VietNamNet Bridge - The natural monopoly that any airport developers can enjoy aamid a fast-growing aviation market have prompted private investors to pour money into airport development.

A series of private investors have applied for the right to operate the Noi Bai International Airport in the north and Phu Quoc Airport in the south, though they do not have deep knowledge about the business field. 

Meanwhile, it is still unclear which requirements investors have to satisfy to get the concession to exploit the airports.

The Ministry of Transport, which also does not have experience in the field, has only offered the concession to exploit the two airports so far in a pilot program, before the concession is applied on a large scale.

An analyst noted that all investors can be sure they will make a profit, because the natural monopoly will bring clients to them. 

Everyone will have to go through Noi Bai if they fly to/from Hanoi, and go through Phu Quoc if they fly to/from Phu Quoc Island.

The increasing high number of airlines, both domestic and foreign, that have air routes to Hanoi also promises fat profits for airport developers.

Most recently, Jetstar Pacific, the budget airline, has begun providing flights from Hanoi to Hong Kong, starting from April 17. Prior to that, it announced the opening of the air route from Hanoi to Da Lat City in Lam Dong province, a tourism city.

A report of the Civil Aviation Authority of Vietnam (CAAV) showed that the Vietnamese aviation market has been growing steadily over the last 10 years. The annual growth rates of 14.5 percent for passenger air transport and 15.3 percent for cargo transport have been reported for the 2011-2014 period, despite the global aviation market downturn. 

To date, 51 airlines from 25 countries have air routes to Vietnam. The figure is expected to increase rapidly in the context of Vietnam’s deeper integration into the world. 

According to the International Air Transport Association (IATA), Vietnam ranks third in the world in terms of aviation market growth.

The strong growth of the market has prompted domestic air carriers to expand their fleets. Vietnam expects to have 205 aircraft by 2020 instead of 111 aircraft at present.

Air developers can see bigger opportunities from the airlines’ moves to open more air routes and provide more commercial flights. 

There are 22 airports in Vietnam, of which 21 are being exploited with the total capacity of 56 million passengers by the end of 2014, and 58 million by March 2015.

CAAV predicted that the number of passengers to go through the airports nationwide would reach 106 million by 2020 and 200 million by 2030.

NCDT