Incheon Airport privatisation plans under debate
South Korean Government's plan to sell a 49% stake in Incheon International Airport to foreign and domestic investors is drawing protest from Opposition parties, civic groups and the airport labour union (Korea Times, 01-Sep-2010). The government plans to list a 15% stake on the local bourse by the end of 2010, with the remaining 34% being sold to multiple investors in 2011. A single entity will not be allowed to acquire more than 15% of the shares, while foreign investors cannot secure more than a combined 30%. In Dec-2009, the government formed a sales consortium led by Samsung Securities. The securities industry watchers expect the 49% stake sale to generate around one KRW1 trillion (USD845 million).
The Democratic Party and other Opposition parties oppose the airport privatisation stating the airport has and will continue to perform well even under the 100% state ownership, vowing to block the revision of the law governing the operation and management of Incheon and other airports in the country.
Incheon International Airport Corp's labour union and civic groups argue the administration of President Lee Myung-bak may seek to provide favours to well-connected private businesses, particularly foreign investors, by selling stakes in Incheon airport at relatively cheaper prices.
South Korean Government: "If foreign investors and airports hold stakes in Incheon airport, they will be more interested in transferring management and operation techniques. Some worry that we may lose managerial control to private businesses. They also fear it will be more expensive for travellers to fly and airlines to operate. But we will continue to exercise management rights with a 51% majority stake.’’ Kim Sang-do, Director of the ministry’s aviation policy division