Singapore to Build Second Airport Logistics Park by 2030
Singapore is set to embark on a groundbreaking project to construct a second airport logistics park by 2030, aimed at enhancing the capacity of the existing park and solidifying Changi Airport’s position as a regional air cargo hub. This strategic move comes amidst a global shift in manufacturing locations, which is expected to reshape trade and logistics flows, resulting in a surge of cargo passing through Singapore.
Encouraging Logistics Companies to Set Up Regional Distribution Centers
The new Airport Logistics Park of Singapore will provide additional capacity to accommodate more logistics companies, enticing them to establish their regional distribution centers in the region. Minister for Trade and Industry Gan Kim Yong emphasized the importance of this development during the recent Singapore Supply Chain Connect 2024 event, which convened around 400 supply chain leaders to discuss the growth prospects in South-east Asia’s logistics sector.
What is an Airport Logistics Park?
An airport logistics park is a specialized area located near an airport that streamlines the movement of air cargo, thereby reducing processing costs and transit times for goods. Just like its predecessor, the upcoming logistics park will enjoy free trade zone status, offering logistics companies various benefits such as top-notch park management services and attractive cost and tax incentives.
Expanding the Changi Aviation Park
The new logistics park will complement the upcoming industrial zone in Changi East and become part of the broader Changi Aviation Park, which encompasses the Changi Airfreight Centre and the existing 26-hectare logistics park. With the first logistics park operating at full capacity since its completion in 2003, the addition of the new facility will significantly boost Changi Airport’s overall cargo handling capacity from the current 3 million tonnes per year to an impressive 5.4 million tonnes annually.
Enhancing Singapore’s Position in Global Supply Chains
The establishment of the second logistics park is poised to enhance the vibrancy of Changi’s air cargo hub ecosystem and reinforce Singapore’s pivotal role as a crucial node in global supply chains. Minister Gan emphasized that Singapore currently stands as the largest air cargo hub in South-east Asia, with over 6,900 weekly flights operated by nearly 120 airlines. The country is actively seeking to attract shippers to establish their supply chain management hubs in Singapore, with prominent global companies like 3M, Schneider Electric, and Applied Materials already leveraging the strategic advantages offered by the region.
Partnerships for Sustainable Supply Chains
The Economic Development Board (EDB) is collaborating with global shippers to foster new capabilities and develop stronger, more sustainable supply chains based in Singapore. For instance, EDB has supported 3M in establishing a Singapore "supply chain center of excellence," which not only serves as a manufacturing hub but also caters to the specific demands of 3M’s local and regional markets. This initiative has significantly boosted 3M’s Singapore operations, with over 1,400 employees, including more than 700 in the supply chain center of excellence.
In conclusion, Singapore’s ambitious plans to build a second airport logistics park signify a strategic move to fortify its position as a key player in the global supply chain landscape. By expanding its logistics capabilities, attracting top-tier companies, and fostering sustainable supply chain practices, Singapore is poised to maintain its relevance and centrality in the ever-evolving world of trade and logistics.