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Korea Airports Corp. to Manage Airport Construction in Peru
A Gateway Airport to Machu Picchu
Korea Airports Corp. to Manage Airport Construction in Peru
  • By Jung Min-hee
  • July 10, 2019, 12:20
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Korea Airports Corp. (KAC) has been chosen to manage the construction of Chinchero International Airport in Cusco, Peru.

A South Korean consortium led by Korea Airports Corp. (KAC) has won a 35 bilion won (US$30 million) deal to oversee the construction of Chinchero International Airport in Peru. KAC has also landed a deal to operate Manta Airport in Ecuador until 2050.

KAC announced on July 9 that the South Korean consortium was named by the Peruvian government the preferred bidder to become the project management office (PMO) of the South American country's new airport project. Chinchero International Airport is a mid-size airport with a 4 km long runway and a capacity for 4.5 million to 5.7 million passengers. It will be constructed in Cusco, Peru, for opening in 2024.

As the KAC-led consortium has become the PMO, South Korean construction companies will be able to participate in the airport construction project. The new airport will become the gateway airport to Machu Picchu, one of the most popular tourist attractions in the world. This is the first time that South Korean companies have received an infrastructure project from a foreign government in the form of PMO.

Until now, domestic firms took part in major overseas construction projects in the form of engineering, procurement and construction (EPC). The PMO is a higher-level project than EPC. The KAC-led consortium will be in charge of overseeing the whole project on behalf of the Peruvian government, including selecting construction firms, contract management, quality inspection, design review and conducting a trial run.

KAC received approval on the management of Manta Airport from the Ecuadorian government on June 21. Currently, the airport’s passenger terminal is under reconstruction due to earthquake damage. When the reconstruction is completed in 2020, KAC will set up a special-purpose company (SPC) and directly operate the airport for 30 years from 2021 to 2050.

It is now in talks with the Ecuadorian government on returning 20 percent of profits from airport operation to the central government and 15 percent to local employees. The Ecuadorian government will exempt the SPC from corporate taxes for 15 years.

In addition, KAC is pushing for a project to strengthen the ability of aviation experts in Paraguay and the construction of a flight training center in Vietnam.