PH wants to transform Clark into aerospace hub 

The Philippines is making a bid for Clark International Airport (CRK) to be a major aerospace and aviation hub at the Singapore Air Show, according to a report by BusinessMirror..

In a news statement, Berthaphil Inc., a key stakeholder and pioneer investor and developer in the Clark Freeport and at CRK, said the Philippines is particularly targeting maintenance, repair and overhaul (MRO) firms, aerospace manufacturers, fixed-based operators, business aviation companies, original equipment makers, cargo airlines, logistics companies, regional and international airlines, training organizations, among others.

Supporting the bid are the Department of Transportation (DOTr), Civil Aviation Authority of the Philippines (CAAP), and Clark International Airport Corp. (CIAC), which are all exhibiting at the Philippine Aviation Pavilion during the air show. Investors in the Clark Freeport  are entitled to incentives, such as a seven-year tax holiday and a 5-percent corporate income tax rate.

For one, Bertaphil is actively promoting to global aerospace companies a vacant 10-hectare airfield site in Clark, with primary runway access, which is immediately available “as is“ or for a build-to-suit project. It has 12 real estate projects in the Freeport, which includes the airport’s first bonded warehouse and logistics center.

Skilled Filipino workforce

“Besides world-class airport infrastructure, a strategic location within Asia’s burgeoning aviation market and a favorable business environment, another key strength of Clark International Airport as an aerospace center, is the Philippines’ skilled and qualified workforce,” said Berthaphil Inc. chairman Michael Herman.

He added, “Building a hangar, for example, doesn’t’t mean you have a MRO business. The key to having a successful MRO organization is having the skilled and qualified maintenance engineers and technicians, which is what the Philippines has.”

MRO organizations that have already established operations at Clark include SIA Engineering, which does airframe maintenance, along with Hong Kong’s MetroJet, which maintains business jets. Global courier services, such as UPS, DHL, and FedEx also use Clark as a hub for their business.

CRK is an international gateway to Asia and capable of handling the largest wide body aircraft.

Challenges to global aviation growth

Meanwhile, the International Air Transport Association (IATA) sees a 3.3-percent growth per annum in the next 20 years for the aviation industry. Speaking at the Changi Aviation Summit on February 19, IATA Director General Willie Walsh acknowledged, “That is significantly lower than the growth we witnessed during 2010 to 2019. But I think it does reflect some of the challenges that we as an industry are facing and will face going into the future.”

He cited infrastructure constraints both in the air and on the ground, as well as sustainability commitments, as among the challenges. “Supply chain issues which have now been a feature of the industry for a number of years and are likely to continue for a few more years. The delay and delivery of new aircraft, the problems in relation to engines, labor shortages in some parts of the world, and significantly the cost impact of our transition to net zero in 2050,” he added.

But Walsh pointed out that Asia “is likely to lead the markets with growth around 4.5 percent per annum,” until 2044.

Domestic travel pushes 2023 recovery

In 2023, the industry recovered “over 94 percent” of the global traffic of 2019, led by strong domestic markets, which hit over 4 percent of 2019 levels. However, international traffic continued to lag with just over 88 percent of pre-pandemic levels.

Asia is playing catch up, with 86 percent of the region’s 2019 levels. “The strong performance in domestic markets over 2 percent ahead, but international travel in the region still lagged behind at about 73 percent of 2019. It is important to point out that there was a strong recovery as we went through the year, moving from about 57 percent in January to almost 83 percent in December.”