INTERNATIONAL AIRPORT CREATION PROJECT IN TASHKENT …

INTERNATIONAL AIRPORT

CREATION PROJECT IN

TASHKENT REGION

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AGENDA

Uzbekistan - aviation hub of Central Asia

Uzbekistan - bridge between Asia and Europe

International air routes from Tashkent

Asian aviation hubs

International air routes and hubs in Asia and Europe

Analysis of current condition of the Islam Karimov International Airport

Distances between airports and large cities of the world

Separation of the international airport from NAC “Uzbekistan Airways“

World international and regional airports’ management companies

Creation of a management company "Management of Airports of Uzbekistan“

Need for creation of the International aviation hub outside of Tashkent City

Benefits of creation of the International aviation hub

International airport and development of tourism

Attraction of foreign experts

Financing of the creation of an International Airport

The proposed scheme of financing of the phased construction of the International Airport

Necessary steps to implement the promising project

Ansher Capital – an arranger of various types of financing on implementation of a project

Ansher Capital’s services

Contacts



UZBEKISTAN - AVIATION HUB OF CENTRAL ASIA

Uzbekistan in its geographical location has

no direct access to the World Ocean.

Moreover, Uzbekistan, along with

Liechtenstein borders exclusively with

countries that also do not have access to the

World Ocean i.e. Uzbekistan is a Double

landlocked country.

This circumstance requires to develop other

alternative ways of direct cooperation in the

sphere of trade, tourism and other spheres,

which are less dependent to neighboring

countries’ policies of protectionism. The

development of the aviation hub of Central

Asia is one of optimal ways of solving the

problem.



UZBEKISTAN - BRIDGE BETWEEN ASIA AND EUROPE

Uzbekistan is located in the centre of the air routes between the most populous region of the world - Asia,

where more than 60% of the world's population resides.

If we consider only two factors:

- as an opportunity to service transit passengers flying through Tashkent from such densely populated

countries of the world as India (1.3 billion people), Pakistan (210 million people), Bangladesh (164 million

people) to Europe and America and back;

- as well as the rapidly developing tourism in Uzbekistan, especially Ziyarat tourism (expected to bring

millions of tourists a year to the memorial complex of Imam al Bukhari in the Samarkand region), then the

creation of a new modern International Airport outside of Tashkent city is beyond any doubt.

This new International Airport shall be not just an airport, but a Central Asian aviation hub, connecting Asia

with Europe, America and the rest of the world.

Currently the passenger traffic of Tashkent International airport is 2.7 Mln. people (2017). To compare with

the annual passenger traffic of major Asian airports in 2017 is less by 2-35 times, which indicates that the

new airport has a big potential for growth:


1. Shoudu (Beijing) 95.8 6. Indira Gandhi (Delhi) 63.5

2. Dubai (Dubai) 88.2 7. Incheon (Seoul) 62.2

3. Haneda (Tokyo) 85.4 8. Sheremetyevo (Moscow) 40.0

4. Pudong (Shanghai) 70.0 9. Diwopu (Urumqi) 20.0

5. Atatürk (Istanbul) 63.9 10. Almaty (Alma-Ata) 5.6


INTERNATIONAL AIR ROUTES FROM TASHKENT

Uzbekistan Airways has routes to more than 50 destinations, including countries in Europe, Asia and North America.

The airline's representative offices are operated in 25 countries around the world.



ASIAN AVIATION HUBS

Indeed, there are many aviation hubs serving passengers and cargo

flows between Asia and Europe/America. These are the airports of

Tokyo, Hong Kong, Shanghai, Beijing, Dubai, Bangkok, Istanbul,

Seoul, Jakarta, Guangzhou, Delhi, Singapore, Kuala Lumpur. We

must also not lose sight of the new International Airport near Almaty,

which is being built since 2015 and will be put into operation in the

next 2-3 years.

The newly created International Airport near Tashkent will compete

with some airports in the region for passengers and cargo, in

particular with the airports in Dubai, Istanbul, Urumqi and Almaty.

However, if proper pricing policy will be implemented (it is not only

the prices for air tickets, but also the prices for servicing airlines at

the airport), high quality and reasonable prices for the maintenance of

transit passengers, efficient airport management and other factors, a

new International Airport near Tashkent will have competitive

advantages over other airports in the region.

Involving only 10% of transit passengers from India, Pakistan,

Bangladesh and Western China to Europe and America and back,

which will be about 100.0 million passengers per year, will increase

the passenger traffic of the new International Airport of near Tashkent

by more than 5 times and exceed 10.0 million passengers per year.

This does not include cargo flows.



INTERNATIONAL AIR ROUTES AND HUBS IN ASIA AND EUROPE



ANALYSIS OF CURRENT CONDITION OF THE ISLAM KARIMOV

INTERNATIONAL AIRPORT

The Islam Karimov International Airport is technically,

economically and ecologically and from a security point of

view, significantly obsolete. It is considered that the

international airport is the face of the country, which

determines the image of the country in the eyes of foreign

guests and investors.

Having such fine historical monuments in Samarkand,

Bukhara, Khiva and Tashkent, we still do not have a decent

image, the image of a beautiful and modern country.

The location of the airport is almost in the centre of Tashkent

city that also adversely affects the possibility of turning the

operating airport into a modern international airport, an

aviation hub in which it would be possible to increase both

passenger traffic and cargo flows.

The total area of the airport is 1 sq. km. with 110 parking lots

for long-distance and medium-haul aircraft, and this does not

allow the creation of an international aviation hub. When it

comes to takeoff and landing of aircraft, the size of airport

area matters. Areas of large International Airports vary from

15 sq. km to 315 sq. km.



DISTANCES BETWEEN AIRPORTS AND LARGE CITIES OF THE

WORLD

Names of airports and countries Distance to

city center

Inland transport at the airport Types of used transport to the city center

1Arlanda Airport, Stockholm, Sweden 40 km There are 4 terminals at the airport, a free shuttle runs

between them.

High-speed train, bus or taxi.

2Franz Josef Strauss Airport, Munich,

Germany

30 km The airport has 2 international terminals. S-Bahn (city rail), Lufthansa Airport Bus or

taxi.

3 Schwechat Airport, Vienna, Austria 20 km The airport has 4 terminals Train, bus and taxi.

4Charles de Gaulle Airport , Paris,

France

25 km The airport has 3 terminals and serves both international

and local flights. Between terminals a free shuttle runs.

Train, bus and taxi.

5Heathrow Airport, London, UK 30 km The airport has 5 terminals. Between terminals you can

move freely on free shuttle basses.

Train, metro, bus, taxi.

6

Malpensa Airport, Milan, Italy 45 km At the airport there are 2 terminals, terminal number 2 is

operated only by the airline EasyJet. Free shuttles run

between terminals.


7 Abu Dhabi International Airport, UAE 30 km There are 3 terminals at the airport. Bus and taxi

8Frankfurt am Main Airport, Frankfurt,

Germany

13 km The airport has two terminals, shuttle trains run between

them.


9Hong Kong International Airport 40 km The airport has two terminals, in Terminal 2 there is an

entertainment center Sky Plaza.


10Sheremetyevo International Airport,

Moscow, Russia

29 km The airport has 5 terminals. Train, bus and taxi.


The table above demonstrates that the majority of International Airports are located at a distance of 20 to 40

km from the city. And almost all airports are connected to the city centre by train, bus and taxi, sometimes by

metro. And there is no problem for passengers to get to or from the airport.


SEPARATION OF THE INTERNATIONAL AIRPORT FROM NAC

“O’ZBEKISTON HAVO YO’LLARI"

One of the main problems that prevent the efficient development of airports in Uzbekistan is their ownership

by the national air carrier - NAC “O’zbekistan Havo Yo’llari". This leads to a conflict of interests between

the airport and the air carrier, a monopolist. Therefore, it is necessary to separate the international airport

from NAC " O’zbekistan Havo Yo’llari ". The table in the next slide demonstrates that almost all

international airports in the world are managed by independent management companies and none of any

analyzed big airports in the world is owned by the air carrier.

The ownership of this management company can be both public and private.

Therefore, we propose the creation of the Managing Company "Management of Airports of Uzbekistan",

which will manage the newly established International Airport and other regional airports in Uzbekistan.



COMPANIES MANAGING INTERNATIONAL AND REGIONAL

AIRPORTS OF THE WORLD



Names of airports

and countries

Name of Managing

Company

Owner of Managing Company Air carrier, for which the airport is the main hub

1 Heathrow Airport,

London, UK

Heathrow Airport

Holdings

Public company. Heathrow Airport Holdings is owned

by Ferrovial (25%), Qatar Holding (20%), and others.

The airport is a hub for British Airways, Virgin Atlantic Airways.

The airport is used by more than 80 airlines of the world.

2 The International

Airport. John

Kennedy, New York,

USA

Port Authority of New

York and New Jersey

New York agglomeration (local government) The airport is the main hub for JetBlue Airways and an important

international hub for American Airlines and Delta Air Lines.

The airport is used by more than 90 airlines of the world.

3 Narita International

Airport, Tokyo, Japan

Narita International

Airport, Japan

State enterprise The airport is a hub for Japan Airlines, All Nippon Airways, and an

important regional hub for Delta Air Lines and United Airlines.

More than 70 airlines of the world use the airport.

4 Airport Charles de

Gaulle, Paris, France

The company Aéroports

de Paris (ADP)

Groupe ADP, a public company where the state owns a

majority stake

The airport is the headquarters and main interchange node of France's

national airline Air France.

Nodal airport is also for XL Airways France, American Delta Air Lines

and Freight Express FedEx.

5 Frankfurt am Main

Airport, Frankfurt,

Germany

Fraport AG Public company. The shareholders of Fraport AG are the

State of Hesse (31.31%), Stadtwerke Frankfurt am Main

Holding GmbH (20.00%), Deutsche Lufthansa AG

(8.44%) and others.

AeroLogic, Condor, Lufthansa, Lufthansa CityLine, Lufthansa Cargo

6 Dubai International

Airport, UAE

Dubai Airports Company The Office of Civil Aviation of the United Arab

Emirates, Government of Dubai

Emirates Airline, Flydubai.

Secondary hub for Jazeera Airways, Iran Aseman Airlines, airblue, Royal

Jordanian.

7 Sheremetyevo

International Airport,

Moscow, Russia

Sheremetyevo

International Airport JSC

Sheremetyevo Holding LLC (66%) and Rosimuschestvo

(30.43%) are the main owners of the Sheremetyevo

International Airport shares. The remaining shares are

owned by PJSC Aeroflot (2.43%) and LLC VEB Capital

(1.1%).

Aeroflot

8 Almaty International

Airport

Almaty International

Airport JSC

100% of the shares of JSC "International Airport of

Almaty" belong to the Netherlands company Venus

Airport Investment B.V.

Air Astana


CREATION OF MANAGEMENT COMPANY "MANAGEMENT OF

AIRPORTS OF UZBEKISTAN"



Management company "Management of Airports of Uzbekistan" should be created in the form of a joint-stock

company on the basis of:

- State Unitary Enterprise "International Airport Tashkent ";

- 10 State Unitary Enterprises of the international airports of Andijan, Bukhara, Karshi, Navoi, Namangan, Nukus,

Samarkand, Termez, Urgench and Ferghana;

- "Islam Karimov International Airport" (which will be transformed into an airport serving domestic airlines inside

Uzbekistan);

- airport complex of civil (business) aviation, created on the basis of the airfield "Tashkent-Vostochny";

- State Unitary Enterprise "Flight Complex";

- Center "Uzaeronavigatsia";

- State Unitary Enterprise “Catering";

- Air company "Uzbekistan airways technics".

10 regional airports will be branches of the newly created management company "Management of Airports of

Uzbekistan".

Management company "Management of Airports of Uzbekistan" will provide aviation and passenger services,

ground support services and firefighting services for airlines. It is also be responsible for the services of a

franchised land handling agent, in-flight food services, retail store operations, food and beverage, and rental of

advertising space inside and outside the terminals.


NEED FOR CREATION OF THE INTERNATIONAL AVIATION HUB

OUTSIDE OF TASHKENT CITY

The International Airport will be the main hub for the National Airways Company "O’zbekistan Havo Yo’llari".However, based on the experience of other aviation hubs, the new International Airport should become asecondary hub in Central Asia for various regional and international airlines serving both passengers and cargotransportation. The table above demonstrates that the largest international airports, in addition to their nationalairline, are served by another 50-90 airlines worldwide. These are huge additional revenues for airports.

The need to build a new international airport as an air passenger and cargo hub is also dictated by the fact thatoutside the city of Tashkent it will be possible to create a modern infrastructure that will allow both passengersand cargo to be serviced, to combine all types of transport, including aviation, railway, buses, metro, taxi.

Passengers arriving at Tashkent International Airport, including transit ones, can easily transfer to high-speedtrains and reach to Samarkand, Bukhara and Khiva within 2-4 hours. This will allow developing inbound (ziyarat)tourism in Uzbekistan. The same applies to the carriage of goods, which upon arrival at the International Airportthrough its cargo terminal can be sent to the destination by railway and motorway.

The creation of the airport outside of Tashkent will also allow preserving the ecology, providing security for themultimillion inhabitants of Tashkent, developing the infrastructure of the area where the airport will be created.

The creation of an aviation hub will serve as a catalyst for the development of related industries and businessesserving the airport, from the delivery of food products to the numerous restaurants and cafes located at the airportcomplex, to various goods for sale in the Duty Free zone.

As a result, tens of thousands of residents of nearby towns and villages will have new jobs.



BENEFITS OF THE CREATION OF THE INTERNATIONAL AVIATION

HUB

Establishing the aviation hub at the airport allows to compete with budget air carriers, as well as optimize the

structure of costs and revenues: emerges economies of scale. In the case of a hub, an airline does not

necessarily need to connect all the cities of its route network, as do "low-costers". It is enough to fly from one

city only; all that needs to be done is to provide passengers with comfortable docking. The main task of the

hub is to service transit passengers.


For Uzbekistan, the hub is advantageous

because:

allows to increase the GDP, create new

jobs, attract foreign direct investment to the

region;

develops tourism and raises the status of

the country;

provides a link between local markets and

remote and global markets.

To airlines, the hub provides such

advantages as:

increase of flight frequency;

reduction of market risks due to the

retention of a passenger in their network of

routes;

expansion of the reduced-cost flight

network.

Passengers will get benefits from:

more direct flights;

more opportunities to return by return flight

on the same day;

wider choice of destinations;

cheaper air tickets, etc.

Airports, becoming hubs, get the

opportunity:

increase passenger flow;

increase revenue;

to strengthen positions in the market in

relation to airlines.


INTERNATIONAL AIRPORT AND DEVELOPMENT OF TOURISM

The name of the International Airport plays a significant role in attraction of tourists to Uzbekistan.

Based on their strategic goal of developing inbound tourism in Uzbekistan, especially ziyarat tourism, it would beexpedient to call the airport "Imam al-Bukhari International Airport".

The name itself will allow its numerous admirers from the Muslim world to try to visit Samarkand and Bukharaand, accordingly, use this airport.

With effective use of the opportunity provided by the Government of Uzbekistan for transit passengers to stay inUzbekistan for up to 5 days without an entering visa, the travel companies could arrange one-two-day tours for thepassengers arriving from India, Pakistan, Bangladesh, Indonesia, Western China and other countries to historicaland holy places in Samarkand and Bukhara. This would greatly increase the number of tourists.

About 1.0 million people have committed the Hajj from the Asian countries in 2017, in particular (thousandpeople):

Indonesia (221.0), Pakistan (179.0), India (170.0), Bangladesh (127.0), Iran (86.5), Turkey (79.0), Egypt (108.0)and Russia (20.0) etc.

This is the evidence that people in these countries have great interest in ziyarat tourism and Uzbekistan can attractthem.



ATTRACTION OF FOREIGN EXPERTS

To implement this ambitious project it is necessary to involve foreign consulting and engineering companies thatwill develop a feasibility study and master plan for the airport, including determining the most suitable locationand size for the airport.

Further, on the basis of the tender, it will be possible to select world-renowned design, architectural, constructionand other companies that will design, create architecture, taking into account national features of Uzbekistan,construction using the latest building technologies, furnishing with modern and safety equipment, training ofemployees, airport management and etc.

Foreign companies active in the region


Name of the Company Country List of services

1

Egis Group France Provides consulting and engineering services in the field of the air transportation industry, and

operates 17 airports in 8 countries.

2

Vinci S.A. France Provides concession and construction services in the field of the air transportation industry.

3

Lufthansa Consulting

GmbH

Germany Provides consulting services and solutions in the air transportation industry all over the world.

4

Changi Airports

International

Singapore Provides services in airport consulting and management, and also an invests in the global aviation

market.

5. Incheon International

Airport Corporation

South Korea Provides consulting services at all stages of airport construction, including training airport staff to

effectively manage the airport.


FINANCING THE INTERNATIONAL AIRPORT

Creation of the International Airport can be financed by Uzbek government, Multinational financial institutionsand foreign investors using old types of financial instruments.


Investment project "Imam al-Bukhari

International Airport"

Financing from the

state and local

budgets

Direct investments

Domestic and

foreign

investments

Debt financing

International

and foreign

banks

Domestic

banks (foreign

credit lines)

Technical assistance

Foreign

development

agencies

Private Equity

Funds


THE PROPOSED SCHEME OF FINANCING OF THE PHASED

CONSTRUCTION OF THE INTERNATIONAL AIRPORT

I - STAGE

•Establishment of a management company in the form of Joint Stock Company;

•Assets: assets transferred from NAC “Uzbekistan Airways"

•Financing: State Budget

•Responsible for execution: Working group, Ansher Capital

II - STAGE

•Attracting foreign consulting companies for selection of design, engineering, construction and other companies

•Financing: Grant from foreign sources

•Responsible for execution: Management company, Ansher Capital

III - STAGE

•Search and hiring companies for the development of feasibility study, master plan, architectural plan and other documents necessary for the construction of the International Airport

•Financing: State budget, Grant from foreign sources and loans


IV – STAGE

•Search and hiring contractors for the construction of the International Airport

•Financing: State budget, loans from international banks


V - STAGE

•Construction of the International Airport (by stages)

•Financing: Different types of financing , including Private placement, IPO, etc.




NECESSARY STEPS TO IMPLEMENT THE PROJECT

The first step in the implementation of the project should be the formation of a working group under the Cabinetof Ministers of the Republic of Uzbekistan, which would deal with:

- preparation of the detailed action plan of reorganization of the NAC “Uzbekistan Airways”;

- preparation of draft Decrees of the President of the Republic of Uzbekistan and the Resolutions of the Cabinet ofMinisters on the creation of the International Airport outside of Tashkent city;

- establishment of a management company "Management of Airports of Uzbekistan”, which would manage theInternational Airport and other airports in Uzbekistan;

- search and attracting authoritative foreign consulting, engineering, design, architectural, construction and othercompanies necessary for the creation of the airport and its infrastructure.

Attracting investment and financial management of the investment project "Imam al-Bukhari InternationalAirport" and the role of Ansher Capital

- searching and attracting international and local investors;

- forming a polo of investors, establishment and management of a Private Equity Fund;

- attracting funds from the International capital markets through placement of the shares of the ManagementCompany on the International Stock Exchanges (IPO).



ANSHER CAPITAL - THE ARRANGER OF ATTRACTING A DIFFERENT

TYPES OF FINANCING FOR THE IMPLEMENTATION OF PROJECT

Ansher Capital is leading investment banking company in Uzbekistan;

The company successfully conducts business on a regional and international levels;

Has a solid experience in attracting financing for various national and regional companies of variousindustries;

Provides access of Uzbek companies to foreign capital markets and assists foreign companies inentering the markets of the region;

Has a broad international base of investors, including in major international financial centers (NewYork, London, Paris, Zurich, Shanghai, Singapore, etc.);

Ansher Capital received international and national recognition, including 5 Euromoney Awards(Euromoney, UK) as "Best Investment Bank" in Uzbekistan and Central Asia, 1 EMEA Finance Award("EMEA Finance", UK) as "Best Investment Bank in Uzbekistan "and 4 awards of the Center forCoordination and Development of the Securities Market of Uzbekistan as" The Best InvestmentConsultant ".



ANSHER CAPITAL’S SERVICES

Ansher Capital, which has many years of experience in attracting various types of investments in Uzbekistan,could act as a consultant in the search and attraction of investments from abroad, which are necessary for theconstruction of the International Airport outside the city of Tashkent.

Ansher Capital could create a consortium of foreign companies (from the leading investment banks, auditing,legal and other companies) that would deal with:

reorganization of the National Air Company "Uzbekistan Airways" and the withdrawal of its airports andairport-related services and structures;

creation on this basis of the Management Company “Management of the Airports of Uzbekistan";

attraction of various types of financing for the Management Company “Management of the Airports ofUzbekistan", necessary for the stage-by-stage construction of the International Airport outside the city ofTashkent, including the withdrawal of its shares to international stock exchanges through the organization ofthe Initial Public Offering (IPO).



CONTACTS

THANK YOU FOR ATTENTION!

IF ANY QUESTIONS ARISE ON THE PRESENTATION,

PLEASE REFER TO THE FOLLOWING CONTACTS:

ANSHER CAPITAL LLC

Uzbekistan, 100052, Tashkent,

str. Katta Darkhon, 19

Tel: (+ 998 71) 2689970

E-mail: [email protected]

WE WILL BE GLAD TO ANSWER ALL YOUR QUESTIONS AND

ACCEPT YOUR VALUABLE COMMENTS.


INTERNATIONAL AIRPORT CREATION PROJECT IN TASHKENT …

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