The Komodo Airport upgrade PPP is the first step in a wider airport private investment plan in one of the world’s most populous countries, Indonesia. But COVID-19, uncertainty over local currency financing and airline fee increases could damp international interest, reports Eduard Fernández
The fishing town of Labuan Bajo in the Indonesian province of East Nusa Tenggara is the sleepy gateway to the nearby Komodo National Park, home of the famed Komodo dragons. It is one of the Indonesian government’s priority tourist destinations and requires new infrastructure to support growth in visitor numbers. One of the latest planned investments is the upgrade of the Komodo Airport, the first airport in the country to be awarded as a concession to private investors.
In December, the IDR 1.2trn (USD 72m) PPP, which includes the expansion of the domestic terminal and the creation of a new international terminal, was awarded to a consortium of Singapore’s Changi Airports International (CAI) and Indonesian airport services provider Cardig Aero Services.
As well as bringing international tourists to the Komodo dragons, the airport investment now has the potential to open up the whole sector in a country where, with 17,000 islands, air travel is one of the most important forms of transport.