Debt burden to fund Hong Kong’s airport expansion soars to HK$123 billion
- Legco panel hears that Covid-19 crisis caused ‘significant’ increases in the amount of debt linked to airport project
- Airport Authority says ‘difficult to say’ when it can end the use of a construction levy paid by every passenger who flies from Hong Kong
The Airport Authority said on Tuesday the total debt for the airport expansion work, expected to be completed this year, had jumped because of the impact of the coronavirus crisis.
“There were significant increases due to the Covid pandemic … since the commissioning of the three-runway system will be introduced in phases, it is difficult to say when we can stop charging the related levies,” Julian Lee Pui-hang, the authority’s director of finance, told a Legislative Council panel.
“We also expect it will still be a while before [passenger numbers] fully recover.”
Lee was speaking after questions from Perry Yiu Pak-leung, a tourism sector lawmaker, who wanted to know when the authority would stop the special charges, introduced in 2016 to help fund the expansion of the airport.
The “Airport Construction Fee” at present charges every passenger, including those transiting through Chek Lap Kok, between HK$70 and HK$180 a trip, depending on distance and seat class, and is collected as an extra fee when tickets are bought.
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The levies were part of a financial arrangement announced before work started in 2016.
The government decided not to use taxpayer cash to fund construction, which allowed it to bypass Legislative Council approval.
It opted to use levies on passengers and airlines, as well as its own savings, bank loans and bond issues instead.
The authority also offered HK$5 billion in retail bonds to the public in January for the first time in two decades to raise extra funds.
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Airport officials also told the Legco panel that, although the new terminal was expected to be completed by the end of the year, it was not yet clear when it would be brought into service.
Steven Yiu Siu-chung, the authority’s executive director of airport operations, said passenger numbers had only recovered to 80 per cent of pre-pandemic figures by the Christmas and new year holidays.
“We do not expect numbers to return to pre-pandemic levels until at least the end of this year, and our current Terminal 1 still has the capacity to handle the traffic,” he said.
“We will continue to monitor and assess our passenger rates, but we do not have a set time frame yet.”
