The Durban Aerotropolis, a new urban environment which will be developed around King Shaka International Airport, is set to be a purpose-built airport city, designed to enhance urban, regional and national competitiveness.     African News Agency (ANA) Archives
The Durban Aerotropolis, a new urban environment which will be developed around King Shaka International Airport, is set to be a purpose-built airport city, designed to enhance urban, regional and national competitiveness. African News Agency (ANA) Archives

Dube Tradeport: Development of an aerotropolis for Africa

By Prof. Douglas Baker Time of article published Jan 22, 2020

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DURBAN - Dube Tradeport is the leading aerotropolis for Africa and one of the primary international aerotropolis developments over the past decade. 

It is the culmination of well-co-ordinated planning and a strategic vision for South Africa.

It consists of 32000 hectares and is centred around King Shaka International Airport (KSIA), located 30km north of the city of Durban. It is linked to the seaports of Durban and Richards Bay through a well-developed road network.

Dube TradePort is modelled on the aerotropolis concept as developed by John Kasarda. He argues that airports are shaping urban development in the 21st century, much as highways did in the 20th century, railroads in the 19th and seaports in the 18th.

This fourth innovative wave of transportation technology impacts primarily through business location and the new dictum of “survival of the fastest”, with supply chain logistics and other time-sensitive economic activity, valuing proximity to airports as gateways and conduits for flows of people, materials and information.

Kasarda has been prominent in maintaining the significance of airports as engines for local and regional economic development in their attraction of directly aviation-linked activity, and more indirectly aviation-orientated land uses in the immediate airport environs and along radiating transportation corridors.

The standard definition of an aerotropolis has it consisting of a core “airport city” with extensive outlying corridors and clusters of aviation-orientated businesses, such as manufacturing, distribution, warehousing, and e-commerce fulfilment centres, plus associated exhibition and conference centres, shopping malls, hotels, office buildings, business, retail and even theme parks and residential developments.

It is a spatial representation of the direct, indirect, induced and catalytic economic impact of airports.

It captures the transformation of airports into commercial operations drawing considerable revenue from non-aeronautical sources and being actively involved in land development.

This concept has been embraced by many airports at different scales and in varied ways around the world.

Airports have evolved from transportation nodes into multi-faceted business enterprises. Commercial land side development around airports has developed to take advantage of the airport - as a trade port - and has created new economic markets at a global scale.

Greenfield opportunities on under-developed airports have fostered large-scale property development such as on Brisbane Airport. The rise of non-aeronautical uses is a defining element of the new airport and non-aviation commercial revenues (notably, retailing and car parking) on average now account for half of all airport income worldwide.

These trends are contesting conventional wisdom about the very nature of airports and pose considerable challenges for stakeholders.

As airports need to expand beyond purely technical aviation concerns, their operations and planning intersect with the surrounding urban environment across a variety of economic, environmental, infrastructural, social and institutional interfaces.

The aerotropolis can no longer function solely under the direction of the airport; the city and the airport become more interdependent whilst their interests do not necessarily converge.

This transformation of airports is driven by multiple factors. These include the inexorable rise in passenger numbers; the emergence of more entrepreneurial airport owners and managers with a need to create additional revenue streams beyond traditional aeronautical sources (landing fees, gate leases, passenger service changes) for profit, infrastructure investment and counter-cyclical business reasons; the ability of some airports to supply conveniently-located serviced land for relatively footloose businesses; the increasing role of e-commerce and logistics, the globalisation of supply chain management and rise of “just in time” manufacturing and delivery.

An airport is no longer a government department, but a commercial enterprise.

Different airports have been able to exploit comparative advantage reflecting their regional economic settings.

The relative “success” of commercial diversification strategies is ultimately attributable to a variety of elements - that are linked in synergy. The first element is based on leadership and vision.

Dube TradePort has had a consistent vision over the past decade in terms of its role and significance to KSIA and the local economy.

The province has made Dube TradePort a flagship enterprise with respect to infrastructure development, commercial importance, and national significance.

The vision is to make it a leading global manufacturing and air logistics platform that is well integrated with intermodal transfer and export markets.

Secondly, governance of legislation and regulations needs to be seamless to support economic development and planning.

Dube TradePort has a well-co-ordinated governance structure that starts with the Dube TradePort Corporation, a public entity of the KwaZulu-Natal provincial government, to manage and champion the trade port. The Department of Trade and Industry provides a Special Economic Zone (SEZ) policy that provides a framework for SEZs.

Dube TradePort has used SEZ status for Dube TradeZone and Dube AgriZone.

In doing this, they have reduced governance issues to create a “one-stop-shop” approach as a single point of contact with customers to interface with government agencies on licences, visa services and investor opportunities.

Other incentives include reduced corporate income tax, building allowances (accelerated depreciation allowance on capital structures), employment tax incentives, customs-controlled area, and tax allowances for greenfield/brownfield industrial projects.

Thirdly, the provision of infrastructure needs to enable transport, the flow of goods, and effective linkages to the city and state networks for the transport of cargo and passengers.

KSIA has a comprehensive integrated master plan completed in 2005 to co-ordinate infrastructure development with the airport objectives.

Dube TradePort Corporation has an air services strategy, which facilitates the establishment of new regional and international air services to and from the airport.

It is actively involved in a comprehensive airline route development support programme “Durban Direct”, with the intent to expand international air connectivity to facilitate the growth of cargo, trade, investment and leisure opportunities.

In addition, state and city highways connect the airport with both ports and inland destinations.

Lastly, technology needs to be co-ordinated to enable digital communication and sharing between industries and government. Digital identity and technologies are becoming important in trade between economies and countries.

Dube TradePort has taken unprecedented steps to create Dube iConnect as a cutting-edge telecoms platform and cloud service provider to clients.

The increasing importance of blockchain technologies for the export market is well integrated into the overall infrastructure provision for the trade port.

Airports are changing urban form by virtue of their choices of developing land within airport boundaries, where aviation and non-aviation land uses are strategically developed and integrated according to new business models.

There is a significant difference between traditional airport development plans to the new digital aerotropolis model of development.

Dube TradePort has been developed with the understanding that the global economy requires local airports to have the well-developed and interconnected infrastructure to compete at an international scale.

The key to the success of this airport development is leadership and vision.

It is my view that this type of commitment at the senior management levels between the private sector and the government permeates through to the grassroots level to support the success of the vision.

In addition, leadership requires much more hard work than just vision.

An aerotropolis needs to have the international connections and trade protocols established to ensure the flow of goods through the trade port.

As I flew out of Durban, I shared a flight with one of the executives who was flying to China to secure a deal - this is what makes it work.

Professor Douglas Baker is of School of Built Environment, Queensland University of Technology, Brisbane, Australia.

BUSINESS REPORT 

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