The Civil Aviation Authority of Singapore (CAAS) is
giving out a total of Sin$200 million in 2009 to help airlines and
airport partners tide over the current economic downturn.
This comprises a Sin$63 million relief package
consisting of rental rebates (Sin$43 million) and a newly set up
‘Promotions Development Fund’ (Sin$20 million) for retail, food &
beverage and services concessionaires at Changi Airport, as well
as another Sin$7 million in rental rebates for other airport
These are in addition to the Sin$130 million Air
Hub Development Fund (AHDF) that CAAS recently extended to
airlines and airport partners. The rental rebates, which include
the Government’s property tax rebate, far exceed the Government’s
rebate which CAAS is passing on fully to airport partners. These
relief measures are effective from 1 January 2009 to 31 December
2009, similar to the AHDF.
The Air Hub Development Fund (AHDF) was first
set up at a budget of Sin$210 million for a 3-year period
beginning from 1 January 2003. It was intended to help airlines
and the aviation industry tide over the uncertainty faced by the
global aviation industry then, and to further strengthen
Singapore's position as an aviation hub in the region. When it
expired on 31 December 2005, it was extended for another 3 years
with an enhanced Sin$300 million incentive package to strengthen
the growth of Singapore's aviation sector.
During the 2009 Government Budget, it was
announced that the Government will provide a 40% property tax
rebate for industrial and commercial properties for 2009. In all, CAAS will extend a total of Sin$50
million in rental rebates. This includes an estimated Sin$20
million property tax rebate given by the Government under Budget
2009. The rental rebates are as follows:
20% Rental Rebate:
In addition to the 15% rental rebate under the
AHDF, CAAS will give out an additional 5% in rental rebate for
tenants of offices, airline lounges and warehouses at Changi
Airport and Seletar Airport. This will benefit airlines as well
other airport business partners such as ground handlers, airport
concessionaires and cargo agents.
Retail, food & beverage and service
concessionaires will receive the following rebates:
15% rebate on basic/fixed rental:
All concessionaires at Changi Airport pay a
basic/fixed rent based on the location and size of their outlets.
7% rebate on additional rental:
In addition to the basic/fixed rent, the
majority of concessionaires pay additional rental, which is a
variable component that pegs rental charges to either their
monthly sales or passenger traffic at Changi Airport.
Promotions Development Fund
Besides the rental rebates, CAAS has also
set up a new Sin$20 million Promotions Development Fund to support
the airport’s as well as the retail, food & beverage and service
concessionaires’ promotional initiatives to drive sales at Changi
Passengers passing through Changi Airport can look
forward to greater shopping value with more Changi Shopping
vouchers given out to encourage shopping at the airport through a
slew of airport-wide shopping promotions that CAAS has lined-up
for the rest of the year.
Cargo Incentive Scheme
CAAS has made an enhancement to the AHDF to
include a Cargo Incentive Scheme. Under this scheme, CAAS’
warehouse and office tenants in Cargo Agent Buildings C, D, E and
Megaplex within the Changi Airfreight Centre will receive, on a
quarterly basis, cash payouts of Sin$10 per tonne of cargo handled
in that quarter, up to an amount equivalent to 15% of their
warehouse and office rent for that quarter. This is to provide
cargo agents with further relief and to drive air cargo
performance at Changi Airport.
Mr Lim Kim Choon, CAAS Director-General and
Chief E Executive Officer, said, “The global financial crisis has
had an adverse impact on all our airport partners including
concessionaires, with declining sales due to decreasing travel
demand. General market sentiments expect the economic outlook to
remain bleak, and passenger traffic will continue to experience a
slowdown. We understand the increasingly tough business
environment that our airport partners are currently going through.
We are working very closely with them and are committed to
providing the necessary assistance to improve their businesses.
The relief package that we are providing will help to alleviate
their financial burden in this difficult economic climate.”
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