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Two years later, a second airport deal with China

runway-extended

by Lindsay Shelton
Wellington now has not one but two deals with Chinese construction companies who have both agreed to work on the airport’s expansion. Will they be competing with each other?

The latest deal was finalised in Beijing on Sunday. It’s a Memorandum of Understanding signed by the airport company’s deputy chief executive Matt Clarke with a Chinese construction company – the China State Construction Engineering Corporation – and a Chinese airline who, the DomPost reports, are to work together with the airport company on the runway extension and development of the area, such as building hotels.

The first deal – also a memorandum of understanding – was signed in Beijing in September 2015 by the city council, represented by Cr Jo Coughlan. The two Chinese signatories were another construction company and a property development company. The document was signed in front of a banner which said “Wellington Airport Expansion Project Signing Ceremony.”

With this deal, said the council, Wellington was set to attract significant investment from Chinese companies, and had formalised a partnership to explore funding not only for the Airport’s proposed expansion and hotel, but also the convention centre and housing developments in Shelly Bay. Two years later, no such funding has yet been announced, though WREDA’s (now former) chief executive said at the time there was “a very good base for Wellington business investment, based on a solid foundation of collegiality.”

City council chief executive Kevin Lavery was present at both signing ceremonies. He says the latest deal is about the broader economy, not just the runway. ‘It’s about opening Wellington to the world .. ultimately it’s about more people coming to the city and giving businesses more opportunities.”

The construction company which signed Sunday’s agreement, says Mr Lavery, is the biggest construction company in the world and “as the order books of New Zealand construction firms are full … we need as much labour and expertise as we can get.” The company’s president says it’s working on big projects in 46 countries, and has been working in New Zealand since 2015 with two developments – a “super high-rise” apartment block in Auckland and a hotel. His company would also like to help develop the “economy around the airport”.

Similar remarks were made by the other construction company in 2015. Its chief executive said “This is just the beginning. We are interested in every project, there are a lot of other things to be done.” And the property development company said completion of the Wellington projects would attract more international tourism and thus more demand for hotel rooms in the city.

The airport’s Matt Clarke sounded cautious on Sunday, no doubt aware of the earlier MOU. He said: “The MOU says we will work with CSCEC on the project as a partner but the selection of any final main contractor will be decided later.,”

The airline which signed on Sunday is China Express, described by the DomPost as a regional airline with global ambitions. Its vice president said he was confident it could achieve its job of attracting Chinese tourists, but he’s not quoted on whether his airline would need a longer runway before it could come here.

Mayor Justin Lester seems less optimistic than usual during his visit to China. Before the airport deal was signed, he told the Chinese that Wellington was ranked the most livable city in the world, but it had one big problem: “Our front door to the world is closed because we don’t have a truly international airport.”

As there are almost 900,000 international passengers travelling through the airport per year, it’s hard to agree with his closed door analogy.

25 comments:

  1. glenn, 13. November 2017, 15:58

    Fantastic, now build the tunnels and double lanes to the planes.

     
  2. Traveller, 13. November 2017, 16:25

    Is there really a need for a second hotel (or more) at the airport? And is there room for it?

     
  3. Iona Pannett, 13. November 2017, 17:16

    The runway is not a goer, does not have support of many Wellingtonians, let’s put the money into making Welly resilient. [via twitter]

     
  4. Save The Basin, 13. November 2017, 19:17

    That MOU is not worth the paper it’s written on. [via twitter]

     
  5. Jenny Kay, 13. November 2017, 19:27

    Signing up to extend Wellington Airport’s runway in spite of Court action is irresponsible in the extreme. What is the financial commitment by the WgtnCC? As a ratepayer I’m opposed to misuse of my money. [via twitter]

     
  6. David Bond, 13. November 2017, 20:43

    Trains to the planes please. The one glaring thing missing from all these grandiose plans.

     
  7. Ross Clark, 14. November 2017, 0:30

    As I’ve said before, Wellington Airport would do much better to wait for aircraft technology to improve to the point that planes will have the range to get to Singapore off the current 2000-metre runway. This is what was thought, at one point, would be possible with the B787.

    Also, given the airport’s links to Sydney (a very large hub) as well as Auckland, I am not sure how much market impedance is created by having to take the extra flight through to Wellington. I don’t think that much.

    Separately: David Bond – agreed.

     
  8. TrevorH, 14. November 2017, 8:06

    I agree with Iona Pannett. The runway extension is opposed by many Wellingtonians because it doesn’t add up financially and because of its negative impacts on the environment. The most pressing need for those of us who live here is to make the city more resilient to natural disasters and climate change. Securing the capital’s water supply has to be the number one priority. These signing ceremonies in China are feckless self promotion.

     
  9. Kerry, 14. November 2017, 8:25

    A line on the map above, not quite parallel to the runway extension, is Wellington’s sewer outfall. It is not designed to have large rocks dumped on it, and in my view — as an ex-submarine pipeline engineer — it cannot be reliably protected. Who will pay to move it, where to, and how much will it cost? [A Regional Council report last year stated: “The Moa Point wastewater treatment plant coastal outfall passes through the area of the proposed reclamation…. it is proposed to construct a protection structure over the outfall pipe to avoid damage due to the placement of the dyke and reclamation fill.” And more: “The application states that the effects of the reclamation construction… include loading stress on the pipeline and settlement of sediment/gravels under the pipeline. However, the application does not outline the consequences of damage to the pipeline and potential pollution of Lyall Bay of wastewater should this occur.” ]

     
  10. Father Christmas, 14. November 2017, 10:04

    Which councillors and officers went on this free trip to China? To sign a meaningless (or meaningful?) piece of paper? What is expected of them in return? What is Kevin Lavery’s position in all of this? Is this the same cheap Chinese labour proposed for Frank Kitts Park?

    Many of you voted for the mayor who at the time, to be generous, equivocated on the airport extension when many of us knew his position – the photo with Mayor Wade-Brown told all. We are now paying not only in rates but also in environmental degradation which will spoil the best little capital in the world.

    Justin Lester needs to explain.

     
  11. johnny overton, 14. November 2017, 12:41

    Has the WCC gone completely mad!! Time for a new Wellington flag. Something red with yellow stars & a koru on it would be great. This Lavery guy must be given his marching orders. We are no longer a compliant, far flung outpost of the British empire or a playground for globalisation ideologues. Enough of this cargo cult mentality. Surviving the resource wars & environmental degradation to come, will require local solutions developed by local people, not further intensifying our dependence on foreign powers.

     
  12. Esjay, 14. November 2017, 12:50

    No Resource Consents, no money, never mind – the Wellington City Council as a one third shareholder will ensure that all is not lost for WIAL.

     
  13. johnny overton, 14. November 2017, 15:04

    Remember folks, ultimately the power is in your hands. When these clowns get out of hand then stop funding them for a while. A ‘rates revolt’ may bring them to their senses.

     
  14. ND, 15. November 2017, 15:37

    I wonder if Ken and Justin went by Singapore Airlines seeing WCC set it up and we ratepayers chip in on every ticket.

    Hey doesn’t that mean that Wellington already has a link to Asia?

     
  15. Ross Clark, 15. November 2017, 22:26

    ND – exactly, we do have a direct air link to Asia, if via Canberra. It does need to be switched to a daily B787 instead of the 4pw B777, for it to work well, but that is a separate matter.

     
  16. Guy M, 15. November 2017, 23:33

    Ross – a “direct link to Asia” is not direct, if it is via Canberra. Therefore, if all we have is via Canberra, or Melbourne, or Sydney – all of them – are NOT direct links, and are just as indirect as if via Auckland.

     
  17. Bob the Bushtail Possum, 16. November 2017, 13:25

    Guy, it’s shorter via Canberra to Singapore than via Auckland, and only 11 kms longer than flying direct.

    WEL – SIN 8,498kms
    WEL-CAN-SIN = 2,334+6,175=8,509
    WEL-AKL-SIN = 556+8,372=8,928
    WEL-SYD-SIN = 2,265+6,235=8,500

    http://www.worldatlas.com/travelaids/flight_distance.htm

     
  18. Andy Mellon, 16. November 2017, 15:04

    It might be shorter in distance, but when I took the new route via Canberra, Canberra was fogged up and we got diverted to sit on the runway at Melbourne and a delay of 6 hours. Plus, the service was notably inferior to the normal Singapore Airlines service and the aeroplane was dated and tired.

    I wouldn’t want to take it again. I’ll go back to using Auckland or Sydney.

     
  19. Bob the Bushtail Possum, 16. November 2017, 20:44

    Hey Andy, my last SAL flight was tops. I flew from Wellington to Canberra a month or so ago and it was full except for the back row seat next to me (must be my skunky aroma when I get a bit air phobic). Anyway $153 and super attentive service – I was given 4 cans of Garage Project beer which would have a street cafe value of $40! Okay the plane was a bit dated but the air hostesses certainly weren’t. So much better than Air NZ and there was no 45 minute safety video with unbearable Grylss and his trout.

     
  20. Piglet, 16. November 2017, 21:35

    It really disappoints me to see that the Chinese are to build our airport extension. If it has to be built I would prefer we locals do it. There is no free lunch. They will want something back. It is only an excuse to bring in more and more tourists. Has any one read lately in the Guardian that European cities want to reduce tourism because it’s bad for the locals.

     
  21. Andy Mellon, 16. November 2017, 21:35

    I will say the flight was pretty full from Singapore to Wellington. Mind you, it did have the Brumbies on it at the time, crammed into cattle class with the rest of us (pity the poor lock forwards!). In contrast to your experience, despite the delays the only drinks offered were water and we were each handed a packet of nuts to make up for the fact we’d gone hours without food. The nuts were out of date by 8 months!

    I obviously don’t hold them responsible for the fog and delays – that happens, but the service that we were given in the circumstances was poor and with Singapore Airlines, I’ve only previously experienced the quality sort of service that you’ve referred to.

    Having garage project is a definite plus. Had a couple of Hapi Daze on the way to Singapore (via Auckland) myself. Very helpful staff on that flight!

     
  22. Ross Clark, 16. November 2017, 23:36

    GuyM – OK; how much difference would it make if we did have a direct daily flight to, say, Singapore? My own view is that it might help increase the volume of inbound tourism, slightly; but probably grow the outbound market by more.

    Going by Canberra, or Sydney, spares a transit at Auckland which, because of the space between the domestic and international terminals, is untidy.

     
  23. Dr Sea Rotmann, 20. November 2017, 14:36

    This is such a ludicrous move – can we first wait to hear what comes out of the Supreme Court case seeing the pilots are saying this extension is unsafe for long-haul flights? Or sort out our massive congestion issues from the Eastern suburbs, which will only explode once the idiotic Shelly Bay development starts? Or get a proper business case first that would actually stand up to scrutiny with the Treasury instead of wasting $3m of ratepayer money for Airport spin and puff pieces that no economist takes seriously? Or maybe see how the Environment Court case will go in terms of getting a resource consent for this environmental and social disaster? Or maybe use the $90m in the long-term plan for infrastructure we need, like affordable housing (which Shelly Bay is NOT) or earthquake resilience or climate change adaptation? What is our Mayor doing in China with the WCC CEO – making us the next Banana Republic where China takes over what was once public infrastructure? And how does this fit with his Labour Party’s policies – around foreign investment and climate change? I smell a rat.

     
  24. Citizen Joe, 20. November 2017, 23:17

    I see Celia Wade Brown is leading a tourism package trip to visit the Great Wall of China. It seems that China is very much in vogue with past and current Mayors of Wellington.

     
  25. Concerned Wellingtonian, 21. November 2017, 10:02

    Joe – they like going to China because the don’t have to pay their costs and mayors are really important people in China so it makes the mayors of Wellington feel so good to go there.
    Anyway, the last mayor only went to Auckland to sign the Memorandum of Understanding about the Chinese Garden planned for Frank Kitts Park.
    Sneaky to have to do it in Auckland where the Chinese signatories didn’t know a nice arena was being destroyed and how badly they were trying to spoil the waterfront for Concerned Wellingtonians!
    NB today is a really good day to remember that occasion in Auckland because it was exactly three years ago today that the last mayor signed away another bit of our waterfront.

     

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