Editorial: Angkasa Pura I Needs To Focus on Airports

Indonesia’s airports need massive upgrades. Over the past few years the government has started to do so with the help of state-owned enterprises such as Angkasa Pura I, an airport operator that works in eastern Indonesia .

Makassar and Surabaya already have newly constructed airports, while Bali’s Ngurah Rai International Airport is currently undergoing a major renovation. These airport upgrades are vital for the nation’s aviation industry to continue growing and to meet the rising demands of air travelers.

That should spell good news for airport operators. Angkasa Pura I, for example, is anticipating a 20 percent rise in revenue this year to Rp 3.6 trillion ($400 million) thanks to rapid growth in the use of its airports.

But while Angkasa Pura I can boast about the airports mentioned above , it should really focus on the large number of airports in eastern Indonesia that still require attention and upgrades .

The operator’s intention to boost revenue this year by expanding non-core businesses is laudable, but misplaced.

Before it thinks about building hotels, it should focus on upgrading each of its airports so that all of them, not just a handful, stand up to the required standards. And it needs to do more than improve passenger terminals — new cargo facilities are also needed.

Angkasa Pura I should focus its attention on three fronts. First, it should improve its quality of service, safety, efficiency and productivity so more passengers and cargo can flow through its airports.

Second, it needs to scale up its capacity and volume. As eastern Indonesia experiences economic growth, more people will visit and more goods will flow in and out of the region. Airports will thus become important shipment points and open up new areas, especially in growth corridors that have been earmarked in the eastern part of the country.

Finally, if Angkasa Pura I wants to continue growing, it must win the trust and confidence of passengers, airlines and investors . It can do this by providing better services and upgrading the infrastructure it manages.

Only after it has achieved these three core objectives should the company think about going into the hotel business.