Upload
others
View
1
Download
0
Embed Size (px)
Citation preview
This may be the author’s version of a work that was submitted/acceptedfor publication in the following source:
Baker, Douglas, Merkert, Rico, & Kamruzzaman, MD(2014)The role of air transport & economic growth : the case of regional airports,Australia. InRegional Airport Development 2014, 2014-04-30 - 2014-05-01.
This file was downloaded from: https://eprints.qut.edu.au/71547/
c© Copyright 2014 please consult authors.
This work is covered by copyright. Unless the document is being made available under aCreative Commons Licence, you must assume that re-use is limited to personal use andthat permission from the copyright owner must be obtained for all other uses. If the docu-ment is available under a Creative Commons License (or other specified license) then referto the Licence for details of permitted re-use. It is a condition of access that users recog-nise and abide by the legal requirements associated with these rights. If you believe thatthis work infringes copyright please provide details by email to [email protected]
Notice: Please note that this document may not be the Version of Record(i.e. published version) of the work. Author manuscript versions (as Sub-mitted for peer review or as Accepted for publication after peer review) canbe identified by an absence of publisher branding and/or typeset appear-ance. If there is any doubt, please refer to the published source.
http:// www.regionalairports.com.au/
https://eprints.qut.edu.au/view/person/Baker,_Douglas.htmlhttps://eprints.qut.edu.au/view/person/Kamruzzaman,_Md.htmlhttps://eprints.qut.edu.au/71547/http://www.regionalairports.com.au/
The Role of Air Transport & Economic Growth: The Case of Regional Airports, Australia
Douglas Baker , Rico Merkert, MD Kamruzzaman
Regional Airport Development 2014
Outline
1. State of Regional Aviation in Australia 2. The Relationship between Regional Aviation
and Economic Growth 3. Needs and Challenges for Regions/Airports 4. Conclusion
Regional Airport Development 2014
Challenges for Regional Aviation in Australia
• Maintaining infrastructure – and future costs (50% operate at a loss)
• Increasing security compliance • Training and retention of staff • Maintaining RPT service • Land use planning around airports
Regional Airport Development 2014
Limited Policy and State support
• Very little policy to support regional aviation and airports in the White Paper
• Limited State and Commonwealth support for infrastructure
• Local government has the responsibility for a majority of airports with little state or commonwealth support or direction
Regional Airport Development 2014
So What?
Regional Airport Development 2014
Critical Infrastructure for Regions
• Economic benefits • Social connection • Tourism • Health • Security • Disaster resilience
Regional Airport Development 2014
• Linked to Economic Growth?
Regional Airport Development 2014
Setting the scene
Remote Australia – Tourism + FIFO
Regional/rural Australia – Business Development?
Does regional aviation impact on economic development in all of Australia’s regions?
What about the other way around?
Regional Airport Development 2014
Literature review
• Typically strong correlation between air traffic and economic growth (Airbus (2013), Deloitte (2012), Joint Study on Aviation Capacity for the Sydney Region 2012, regional associations)
– implementation of transportation infra & accessibility leads to economic development
– airports act as catalysts for local investment (jobs)
• Causation between the two not entirely clear (Green 2002; Button et al. 2009)
• Jaunky (2011): CO2 emissions and income; Lio, Liu and Ou (2011): Internet and corruption
• Mukkala and Tervo (2012)
– 86 regions in 13 European countries
– Granger non-causality analysis in a panel framework
– causality processes are homogenous from regional growth to air traffic
– causality from air traffic to regional growth in peripheral regions but the causality is less evident in core regions
• Nothing on regional Australia where the context of regional aviation is specific
Regional Airport Development 2014
Methodology
Analysis of regional airport passenger data
Dynamic panel data causality regression models for 88 airports/LGAs (1985/86 - 2010/11; ARTI and Pax)
Panel data causality regression models for 28 airports in 13 regions in Queensland (Experimental Estimates of Gross Regional Product 2000/01, 06/07, 10/11 and Pax)
Regional Airport Development 2014
Analysis of regional airport pax data tells a very positive story
0
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
30,000,000
35,000,00019
85-8
619
86-8
719
87-8
819
88-8
919
89-9
019
90-9
119
91-9
219
92-9
319
93-9
419
94-9
519
95-9
619
96-9
719
97-9
819
98-9
919
99-0
020
00-0
120
01-0
220
02-0
320
03-0
420
04-0
520
05-0
620
06-0
720
07-0
820
08-0
920
09-1
020
10-1
120
11-1
220
12-1
3
TOTAL PASSENGERS
Source:BITRE Regional Airport Development 2014
Source: BITRE
At the federal level strongest growth in?
Source:BITRE
0
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
16,000,000
18,000,000
Passengers
Queensland the clear winner
Regional Airport Development 2014
Source: BITRE
Magnitude of growth strongest in non-remote regions and driven by major domestic airlines
0
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
30,000,000
35,000,000
1985
-86
1988
-89
1991
-92
1994
-95
1997
-98
2000
-01
2003
-04
2006
-07
2009
-10
2012
-13
Total regionalPassengers
Remote regionaltotal
Non-remoteregional
0
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
1985
-86
1988
-89
1991
-92
1994
-95
1997
-98
2000
-01
2003
-04
2006
-07
2009
-10
2012
-13
MAJOR DOMESTICAIRLINES
REGIONAL AIRLINES
INTERNATIONALAIRLINES
Source: BITRE
Regional Airport Development 2014
Sample Queensland NSW Western Australia South Australia
Northern Territory Tasmania Victoria
BAMAGA ALBURY ALBANY CEDUNA ALICE SPRINGS BURNIE HAMILTON BILOELA (THANGOOL) ARMIDALE BROOME COOBER PEDY AYERS ROCK DEVONPORT MILDURA
BUNDABERG BALLINA CARNARVON KINGSCOTE BATHURST ISLAND FLINDERS ISLAND PORTLAND CAIRNS BATHURST CHRISTMAS ISLAND MOUNT GAMBIER DARWIN HOBART CHARLEVILLE BROKEN HILL COCOS ISLAND OLYMPIC DAM ELCHO ISLAND KING ISLAND
CLONCURRY COBAR DERBY-CURTIN PORT AUGUSTA GOVE LAUNCESTON COOKTOWN COFFS HARBOUR ESPERANCE PORT LINCOLN GROOTE EYLANDT DOOMADGEE DUBBO GERALDTON WHYALLA MANINGRIDA EMERALD GRAFTON KALGOORLIE GLADSTONE GRIFFITH KAMBALDA GOLD COAST LISMORE KARRATHA HAMILTON ISLAND LORD HOWE ISLAND KUNUNURRA HERVEY BAY MERIMBULA LEARMONTH LONGREACH MOREE LEONORA MACKAY MORUYA NEWMAN MORANBAH MUDGEE PARABURDOO MORNINGTON ISLAND NARRABRI PORT HEDLAND MOUNT ISA NARRANDERA RAVENSTHORPE
NORMANTON NORFOLK ISLAND PALM ISLAND ORANGE PROSERPINE PARKES
ROCKHAMPTON PORT MACQUARIE ROMA TAMWORTH
SUNSHINE COAST TAREE THURSDAY ISLAND WAGGA WAGGA
TOOWOOMBA WILLIAMTOWN TOWNSVILLE WEIPA
Regional Airport Development 2014
Sample Remote and very remote airports
Queensland NSW Western Australia South Australia Northern Territory Tasmania Victoria
BAMAGA ALBURY ALBANY CEDUNA ALICE SPRINGS BURNIE HAMILTON BILOELA (THANGOOL) ARMIDALE BROOME COOBER PEDY AYERS ROCK DEVONPORT MILDURA
BUNDABERG BALLINA CARNARVON KINGSCOTE BATHURST ISLAND FLINDERS ISLAND PORTLAND CAIRNS BATHURST CHRISTMAS ISLAND MOUNT GAMBIER DARWIN HOBART CHARLEVILLE BROKEN HILL COCOS ISLAND OLYMPIC DAM ELCHO ISLAND KING ISLAND
CLONCURRY COBAR DERBY-CURTIN PORT AUGUSTA GOVE LAUNCESTON COOKTOWN COFFS HARBOUR ESPERANCE PORT LINCOLN GROOTE EYLANDT DOOMADGEE DUBBO GERALDTON WHYALLA MANINGRIDA EMERALD GRAFTON KALGOORLIE GLADSTONE GRIFFITH KAMBALDA GOLD COAST LISMORE KARRATHA HAMILTON ISLAND LORD HOWE ISLAND KUNUNURRA HERVEY BAY MERIMBULA LEARMONTH LONGREACH MOREE LEONORA MACKAY MORUYA NEWMAN MORANBAH MUDGEE PARABURDOO MORNINGTON ISLAND NARRABRI PORT HEDLAND MOUNT ISA NARRANDERA RAVENSTHORPE
NORMANTON NORFOLK ISLAND PALM ISLAND ORANGE PROSERPINE PARKES
ROCKHAMPTON PORT MACQUARIE ROMA TAMWORTH
SUNSHINE COAST TAREE THURSDAY ISLAND WAGGA WAGGA
TOOWOOMBA WILLIAMTOWN TOWNSVILLE WEIPA
Regional Airport Development 2014
Causality regression results Regional aviation Economic Growth
First-differenced IV regression Group variable: AirportID Number of obs = 1796 Time variable: Year Number of groups = 88 R-sq: within = 0.4426 Obs per group: min = 17 between = 0.9976 avg = 20.4 overall = 0.9893 max = 21 Wald chi2(4) = 19.97 corr(u_i, Xb) = -0.9870 Prob > chi2 = 0.0005 ------------------------------------------------------------------------------ D.LnARTI | Coef. Std. Err. z P>|z| [95% Conf. Interval] -------------+---------------------------------------------------------- -------------+------ LnARTI | LD. | -.8906469 .4528895 -1.97 0.049 -1.778294 -.0029999 | LnTotTot | D1. | .0161805 .0094961 1.70 0.088 -.0024316 .0347925 L2D. | .012739 .0042383 3.01 0.003 .004432 .0210459 L3D. | .0197574 .0102974 1.92 0.055 -.000425 .0399399 | _cons | .0394296 .010296 3.83 0.000 .0192498 .0596093 -------------+----------------------------------------------------------
Regional Airport Development 2014
Causality regression results Economic Growth Regional aviation
First-differenced IV regression Group variable: AirportID Number of obs = 1532 Time variable: Year Number of groups = 88 R-sq: within = 0.0025 Obs per group: min = 14 between = 0.8228 avg = 17.4 overall = 0.2942 max = 18 Wald chi2(4) = 21.57 corr(u_i, Xb) = -0.0611 Prob > chi2 = 0.0002 ------------------------------------------------------------------------------ D.LnTotTot | Coef. Std. Err. z P>|z| [95% Conf. Interval] -------------+---------------------------------------------------------- -------------+------ LnTotTot | LD. | .0356418 .1743109 0.20 0.838 -.3060013 .3772849 | LnARTI | D1. | .6760712 .2105554 3.21 0.001 .2633902 1.088752 LD. | .361041 .2154063 1.68 0.094 -.0611476 .7832296 L6D. | .3120038 .1397229 2.23 0.026 .0381519 .5858558 | _cons | -.0139086 .020695 -0.67 0.502 -.0544701 .0266529 -------------+----------------------------------------------------------
Regional Airport Development 2014
Causality regression results
Strong impact of regional aviation on economic activity in all regions Strong impact of pax numbers on the taxable income of the respective local
government areas (particularly in remote and very remote areas) with a lag of one financial period (year)
Particularly economic growth in remote areas of WA has induced demand for regional aviation
Causality (significant relationship) does not hold for Queensland sample (in either way) as individual airports too small to impact on GRP of a region
Regional aviation and regional business/economic activity depend on each other; one cannot do without the other; right approach to measure that is at the LGA level
Regional Airport Development 2014
Creative solutions
Regional Airport Development 2014
Business Models
• How do we finance and fund different business models?
• What are optimal business models for different species of airports: airside and landside?
• What thresholds in RPT determine business models?
Regional Airport Development 2014
Management and Operation Models
• What are best practice models?
• Asset Management – present status?
• Masterplanning?
Regional Airport Development 2014
Conclusion
• Clear bi-directional link between regional aviation and economic growth
• How can Local Governments change the present status of RRR airports?
• How can we develop solid empirical research for evidence-based policy?
• What are world’s best-practice business and management models?
Regional Airport Development 2014
Q&A
• Professor Doug Baker School of Civil Engineering and Built Environment QUT [email protected]
• Dr Rico Merkert ITLS, The University of Sydney Business School [email protected]
Regional Airport Development 2014
mailto:[email protected]:[email protected]
The Role of Air Transport & Economic Growth: �The Case of Regional Airports, Australia�Douglas Baker , Rico Merkert, MD Kamruzzaman��OutlineChallenges for Regional Aviation �in AustraliaLimited Policy and State supportSo What?Critical Infrastructure for RegionsSlide Number 7Setting the sceneLiterature reviewMethodologyAnalysis of regional airport pax data �tells a very positive storyAt the federal level strongest growth in?Magnitude of growth strongest in non-remote regions and driven by major domestic airlinesSampleSample� Remote and very remote airportsCausality regression results�Regional aviation Economic GrowthCausality regression results�Economic Growth Regional aviation Causality regression resultsCreative solutionsBusiness ModelsManagement and Operation ModelsConclusionQ&A