INTERNATIONAL AIRPORT CREATION PROJECT IN
TASHKENT REGION
«THERE IS AN IDEA - THERE IS INVESTMENT!»
ANSHER GROUP OF COMPANIES
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
1 Arlanda Airport, Stockholm, Sweden 40 km There are 4 terminals at the airport, a free shuttle runs between them.
High-speed train, bus or taxi.
2 Franz 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.
4 Charles 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.
5 Heathrow 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.
Train, bus and taxi.
7 Abu Dhabi International Airport, UAE 30 km There are 3 terminals at the airport. Bus and taxi
8 Frankfurt am Main Airport, Frankfurt, Germany
13 km The airport has two terminals, shuttle trains run between them.
Train, bus and taxi.
9 Hong Kong International Airport 40 km The airport has two terminals, in Terminal 2 there is an entertainment center Sky Plaza.
Train, bus and taxi.
10 Sheremetyevo 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 a secondary hub in Central Asia for various regional and international airlines serving both passengers and cargo transportation. The table above demonstrates that the largest international airports, in addition to their national airline, 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 that outside the city of Tashkent it will be possible to create a modern infrastructure that will allow both passengers and 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-speed trains 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 Airport through 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 the multimillion 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 businesses serving the airport, from the delivery of food products to the numerous restaurants and cafes located at the airport complex, 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 be expedient 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 Bukhara and, accordingly, use this airport.
With effective use of the opportunity provided by the Government of Uzbekistan for transit passengers to stay in Uzbekistan for up to 5 days without an entering visa, the travel companies could arrange one-two-day tours for the passengers arriving from India, Pakistan, Bangladesh, Indonesia, Western China and other countries to historical and 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 (thousand people):
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 attract them.
ATTRACTION OF FOREIGN EXPERTS
To implement this ambitious project it is necessary to involve foreign consulting and engineering companies that will develop a feasibility study and master plan for the airport, including determining the most suitable location and size for the airport.
Further, on the basis of the tender, it will be possible to select world-renowned design, architectural, construction and 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 of employees, 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 institutions and 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
•Responsible for execution: Management company, Ansher Capital
IV – STAGE
•Search and hiring contractors for the construction of the International Airport
•Financing: State budget, loans from international banks
•Responsible for execution: Management company, Ansher Capital
V - STAGE
•Construction of the International Airport (by stages)
•Financing: Different types of financing , including Private placement, IPO, etc.
•Responsible for execution: Management company, Ansher Capital
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 Cabinet of 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 of Ministers on the creation of the International Airport outside of Tashkent city;
- establishment of a management company "Management of Airports of Uzbekistan”, which would manage the International Airport and other airports in Uzbekistan;
- search and attracting authoritative foreign consulting, engineering, design, architectural, construction and other companies necessary for the creation of the airport and its infrastructure.
Attracting investment and financial management of the investment project "Imam al-Bukhari International Airport" 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 Management Company 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 various industries;
Provides access of Uzbek companies to foreign capital markets and assists foreign companies in entering the markets of the region;
Has a broad international base of investors, including in major international financial centers (New York, 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 for Coordination and Development of the Securities Market of Uzbekistan as" The Best Investment Consultant ".
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 the construction 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 and airport-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 of Uzbekistan", necessary for the stage-by-stage construction of the International Airport outside the city of Tashkent, including the withdrawal of its shares to international stock exchanges through the organization of the 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: info@ansherglobal.com
WE WILL BE GLAD TO ANSWER ALL YOUR QUESTIONS AND ACCEPT YOUR VALUABLE COMMENTS.
