Speech by Minister for Transport Mr Khaw Boon Wan at China Civil Aviation Development Forum (CCADF)

“Addressing Potential Disruptions in Civil Aviation"

Excellency Feng Zhenglin, Administrator, Civil Aviation Administration of China,
Distinguished Guests,
Ladies and Gentlemen,

Expanding Civil Aviation

1.     We have had some exciting speeches which I totally enjoyed, on the future of technology and how we can adopt them to make our life better, especially for us in civil aviation.

2.     As a politician, I thought I would talk a little bit about these positive developments, which I am very bullish about as well, and what if something wrong happens, then how should we prepare ourselves.

3.     I agree with earlier speakers that civil aviation will continue to grow very rapidly, especially in our part of the world.

4.     On the back of such optimism, many Asian airlines are making huge aircraft orders. Many airports in our region are expanding. The new Beijing Daxing International Airport is one, but others too, in Incheon, Hong Kong, Bangkok, Kuala Lumpur. Singapore is building a third Runway and a new Terminal 5.

5.     These investments are hefty and therefore, given the long gestation period, are inherently risky. During construction, there could be external shocks to dampen demand. A prolonged economic crisis, for example, will be devastating for investors.

6.     The global shipping industry offers a cautionary tale. Just as we thought shipping fundamentals were beginning to look better last year, the industry now faces strong headwinds. If carriers are not lucky, they can be caught out again, by glut, oversupply and depressed freight rates. When a shipping company collapses, the consequences are largely borne by the private sector.

7.     In the case of civil aviation, the downturn risk is often borne by Governments and taxpayers. And any transport minister who presides over under-utilised airport terminals, may see his political career prematurely terminated!

8.     Even when demand projections pan out, there will still be risks. The crowded skies will increase the complexity of airspace management; this will place great stress on air navigation service providers. Lives are at stake if safety is compromised.

9.     While advances in technology can help, there are dire consequences when technological developments run too far ahead of the regulators. The recent Boeing 737 Max accidents are unfortunate reminders.

10.     Facing disruption is not new to civil aviation. Indeed, international civil aviation was born during the most disruptive of times. The Chicago Convention which created ICAO was signed in the final months of World War II. Subsequently, civil aviation has endured successive waves of disruptions. Air transport has been resilient and adaptable.

11.     As Transport Ministers and regulators, our responsibility is to help preserve the long term sustainability of civil aviation. One good approach is to follow the ancient Chinese wisdom of “居安思危”: in aviation terms, even as we enjoy the benefits of safety and convenience of air travel, we should remain vigilant, anticipate potential risks, and implement risk mitigating measures. Let me suggest a few ideas.

Mitigating the risks

12.     First, we must take decisive pre-emptive action against emerging risks. One major risk is climate change. The impact of climate change on the aviation industry can already be felt. Adverse weather conditions leading to flight cancellations and airport closures due to flooding are increasingly common.

13.     As an island state, Singapore is vulnerable to sea level rise. We are implementing decisive adaptation measures to protect Changi Airport. These include building flood barriers and upgrading the airport drainage system. For the new Terminal 5, we have deliberately reclaimed the land at 5.5 metres above mean sea level. It may seem excessive today, but may prove wise in future, if climate change worsens.

14.     But prevention is better than cure. We hope the world will take climate change seriously, and act decisively to prevent it from worsening. Every economic sector should play its part. ICAO has formally adopted a CO2 Standard to incorporate emissions design certification standards for both new type and in-production aircraft. ICAO is also developing the Carbon Offsetting and Reduction Scheme for International Aviation. I expect pressure on us to do more and move faster. For the millennial population, protecting the planet is a key priority. We must demonstrate our ability to take decisive action and work collectively on the issue of climate change.

15.     Second, we must respond smartly to disruptive technologies. The pace of technological innovation is only going to gather speed. While technology can enhance operational excellence and travel experience, companies and their workers could be caught wrong-footed.

16.     In Singapore, we have worked with industry and unions to develop Industry Transformation Maps to cover 23 key sectors. Together they make up over 80% of our economy. For each sector, we formulate the specific strategy to transform the industry and importantly, to re-skill the workers. Our Air Transport Industry Transformation Map is one of these 23 stragies, to support the sector’s growth and competitiveness. This is a serious tripartite effort by the Government, unions and companies, to drive innovation, raise productivity, and to prepare our workers in the aviation sector for the future. Our objective is to ensure that our workers remain employable as the industry upgrades and transforms.

17.     Industry transformation is global and the pace is relentless. If we are not careful, many workers may suddenly find themselves without a job. We should help companies and their workers prepare for the inevitable transformation. Otherwise, the political pressure against globalisation will grow, and more will embrace destructive trade protectionism.Singapore is happy to share our experience with other countries and in turn learn from theirs.

18.     Third, we must address safety and security threats that emerge through misuse of new technology. One such threat comes from Unmanned Aircraft Systems, or drones. Recently, the irresponsible and unauthorised use of drones led to a prolonged shutdown at London’s Gatwick Airport. More than 1,000 flights were cancelled.Airlines suffered losses and passengers were severely inconvenienced.

19.     Countries will need to put in place strict regulations and commit long-term investment to build systems and capabilities to deal with these threats. And we should actively share experiences and learn best practices from one another. In Singapore, we will be registering drones above a certain weight. We are implementing a centralised system to provide a situational picture of drone activities.We are also working with security agencies to deploy systems at our airport to detect uncooperative drones, and to take them down if necessary.

20.     Fourth, we must always safeguard aviation safety. With significant air traffic growth, air navigation service providers bear the heavy responsibility of providing air traffic services safely and efficiently. To manage increasingly crowded and complex airspaces, heavy investment in state-of-the-art technologies and systems, as well as investments in continuous training and upskilling, are critical.

21.     Singapore manages the air traffic in one of the busiest, and most complex blocks of airspace in the world. We invest heavily in air traffic management capabilities.We work closely with universities and the industry to formulate innovative air traffic management solutions. Some commentators think that managing air space is a viable business venture, but they are wrong. Fees by airlines barely cover the high cost of managing airspace properly. For example, our current Air Traffic Management system cost over S$300 million. Although it was commissioned only in 2013, we have started developing its next generation, in order to avoid obsolescence. Over the next few decades, we expect to spend a few billion dollars to continue providing efficient and safe air traffic services to the highest standards. Besides hardware, we also invest heavily in the recruitment and training of our air traffic controllers. This is a labour intensive and skills-intensive profession. In our case, we need to deploy 700 air traffic controllers. They go through specialised courses and on-the-job training in a live operating environment. Recently, we launched a new Aerodrome Simulator at the Singapore Aviation Academy. It allows instructors to simulate unplanned situations realistically to train controllers to handle difficult situations, honing their air traffic control techniques. We also work with ICAO to make such training courses available to aviation professionals in other ICAO member states.We are mindful that safer sky ultimately benefits all.

22.     Fifth, we have to increase the operational efficiency of airspace management. Air traffic management today is largely fragmented. This results in inefficiencies, longer flight times, and higher costs for airlines.

23.     To fully realise the benefits of air traffic growth, we should re-think the current arrangements. This is where Governments should take the lead, in integrating airspace and optimising its use.

24.     The Single European Sky initiative is a good example, with functional airspace blocks (FABs) established between various neighbouring countries to deliver safety, efficiency, and environmental benefits. The UK-Ireland FAB is another good example.It enables substantial benefits in reduced jet fuel consumption and CO2 emissions.

25.     The Association of Southeast Asia Nations (ASEAN) Leaders have adopted a vision of a Seamless ASEAN Sky: a seamless block of airspaces with harmonised and interoperable procedures and operations. When fully implemented, we can expect a multi-fold increase in airspace capacity, cost reductions, fewer delays, and enhanced safety of air traffic management. It is a wonderful vision with great benefits for all. It will revolutionise the way we manage air space, taking full advantage of technology which largely already exists. It will however require Governments to take an enlightened win-win approach, grounded on mutual trust. It will take time to realise such a vision. I am confident that it will happen because it is the right thing to do.

Conclusion

26.     On this note, I thank the organisers for the hospitality extended to me and my delegation. I look forward to our subsequent exchanges and discussions.

27.     Thank you.