Lecture 9:The Economic & Political Role of

Airports

By: Zuliana Ismail

The Economic Role of AirportsAirport:

1. Encompass several thousand acres

2. Same functions and infrastructure as a modern city

3. Provide necessary public services

4. Operating budgets in the tens to hundreds of million dollars

5. Capital projects accounting for many millions or billions of dollars

6. Hundreds of occupants and concessionaires engaged in aeronautical and general business generating revenues.

The Economic Role of Airports

• Among the largest public facilities , airport play significant roles in shaping economic of the communities they serve.

• Thus, airport management should responsible for leading the airport positively contributing to the local economy while minimizing the impacts of airport to the environments.

How airports contribute to the economic prosperity of

the communities they serve?

airport activity stimulates economic growth1. TAXES

• Airports generate billion dollar in “taxes "annually

2. AIR ACCESS• Providing air access for various companies to expand

their business.

3. BUSINESS OPPORTUNITIES• Local services-most airports generate billion dollar in

economic activity

4. EMPLOYMENT /JOB OPPORTUNITIES• Most airports generate hundred thousand jobs

5. TOURIST

Taxes• Airports generate billions of dollars per year in state and local

taxes.• These tax dollars increase the revenues available for projects

& services benefit the residents of each state & community.

airport activity stimulates economic growth

airport activity stimulates economic growth

Air access• The airport has become important to the growth of business &

industry in a community by providing air access for various companies that must meet the demands of supply, competition & expanding marketing areas.

• Communities without airports or air service have limitations for economic growth.

• For example: limited industrial development & limited potential for attracting tourism

• Airports play a key role in the community’s ability to attract and retain businesses

Business opportunities• The use of local services for air cargo, food catering to the

airlines, aircraft maintenance, ground transportation also stimulates the economic growth.

• Regular purchases of fuel, supplies, equipment & other services from local distributors inject additional income into the local community.

airport activity stimulates economic growth

FOOD SERVICE

Ground handling

airport activity stimulates economic growth

Employment /job opportunities• Either aviation or non aviation business located at the airport

represent a major source of employment for many communities around the country.

• Most airports generate hundred thousand jobs.• Direct employment – employment attributed to the operation

and management of the airport, airline operations and associated services. Example: MAHB, KLAS

• Indirect employment – employment in non-aviation industries that result from airport activity. Example: ERL, Concessionaries

KLAS: KL Airport Services Sdn Bhd

• KL Airport Services Sdn Bhd or better known as KLAS is independent ground handler that provides a comprehensive range of services to various commercial airlines operating into and through Malaysian Airports..

• KLAS offers the highest standards of quality & efficiency for the following services: Ground Handling Service, Cargo Handling Service, In-Flight Catering Service, Aircraft Maintenance & Engineering Service

airport activity stimulates economic growth

Tourist• Cities with good airport facilities also profit from tourist &

convention business such hotels, restaurants, retail stores, sightseeing & transportation.

OTHER COMMUNITY BENIFITS

Variety of other public benefits:• Time & cost savings associated with air

transportation• Access to national and international markets – global

connections• Enhancement to community well-being/quality of

life• Support of increased tourism/conventions• Comfort and convenience