Incheon Airport
A consortium headed by Korea's Incheon International Airport Corporation (IIAC) won a contract to build a new 1.2 trillion won (US$1.1 billion) international airport in Myanmar. It is the first time for local businesses to obtain an order for airport construction abroad.
The Ministry of Land, Infrastructure, and Transport (MOLIT) announced on August 11 that the consortium was chosen as the preferred bidder to construct Myanmar’s new Hanthawaddy International Airport by Myanmar's Department of Civil Aviation. The consortium includes Halla Engineering & Construction Corp., Kumho Industrial Co Ltd, Lotte Engineering & Construction Co. Ltd., and POSCO ICT Co., Ltd, as well as IIAC.
Since international bids in July last year, four groups, consisting of the Incheon Airport Consortium, Singapore’s Yongnam Holdings Ltd., Japan’s Taisei Corp. and France’s Vinci SA, have been in fierce competition with each other for the project.
Once the Incheon Airport Consortium and Myanmar's Department of Civil Aviation sign a final contract at the end of this year, Korean companies will start building the new airport, which is expected to have an annual passenger capacity of 12 million by 2018. When complete, the airport will be run by the IIAC up to 50 years, until the end of 2067. The consortium estimates that the airport deal will generate hundreds of billions of won in revenue apart from business expenses in the same period.
In fact, the successful bid is a significant one, since it was made possible through a public-private partnership. Following a summit talk between Korea and Myanmar in May last year, Suh Seoung-hwan, the Minister of Land, Infrastructure and Transport, made a direct request for cooperation regarding the contract when Myanmar’s President Thein Sein transferred at the Incheon International Airport in May this year. The minister also fully supported a preliminary feasibility study through a global infrastructure fund.
Last June, Hyun Oh-suk, Deputy Prime Minister for Economic Affairs and Minister of Strategy & Finance, also made the same request while attending a South Korea-Myanmar economic cooperation committee.
A MOLIT official said, "This deal was the result of the combination of both IIAC's world-class airport management capacity, which is proven by pan-governmental cooperation; its winning of the annual Airport Service Quality (ASQ) Awards for eight consecutive months; and Korean companies' first-class construction capability," adding, "The government will now take this opportunity to provide its full support to domestic companies in terms of new businesses, including airport construction projects overseas."