Report says China link worth £510m

A  new Frontier Economics report says that new direct flights from Heathrow to China contribute £510 million per year in GDP to the UK economy and create 14,550 jobs.

The report says an additional flight a week on each existing connection, as a result of expanding Heathrow, could add an additional £16m to GDP.

The figures have been revealed as the Government begins the latest rounds of trade engagement with China as Prime Minister Theresa May sets off on a trade mission. The report also identifies the urgent need to add capacity on these routes in order to support the Government’s trade strategy.

The research reveals Heathrow’s direct flights to China already contribute more than £510m annually to the UK economy and create nearly 15,000 jobs. Just one extra flight per week, on to these existing routes, will provide a further cash injection of £16m a year as a result of increased business travel, and stimulation for increased trade and investment between China and the UK.

This incremental increase in capacity could also support an additional 530 jobs annually, a small taste, says the airport, of the opportunities that will accompany up to 40 new-long haul routes and increased route frequency that Heathrow’s expansion will create.

Heathrow says it acts as a vital link between China and the UK, offering more than 100 direct flights to China every week. Of these, 55 go to Hong Kong, 22 to Shanghai, 20 to Beijing, 10 to Guangzhou and two to Qingdao. Of the £510m annual contribution by existing routes, £315m is made up by Hong Kong, followed by Beijing and Shanghai. While connections to Chinese cities are clearly valuable to the UK, rival EU hub airports with capacity to cope are able to fly to 14 other Chinese destinations, opening up more trade and investment to their respective countries.

Frontier Economics points out the role Heathrow plays as a port of higher value, higher-tech commodities such as aircraft and spacecraft, optical and photographic instruments, pharmaceuticals and electricals and in facilitating trade in sectors ranging from manufacturing to artificial intelligence. Heathrow provides regional connections to the North East, where Chinese company TusPark is in the process of setting up its first innovation centre – which will focus on strengthening links between UK and Chinese companies. Connectivity is also a key factor in continuing the growth of Chinese students studying in UK universities – which how grown by 14% between 2012/13 and 2016/2017.

The planning process for Heathrow expansion is already underway, with the airport carrying out its first public consultation on its emerging plans starting this month. Parliament is expected to vote on a National Policy Statement in the first half of this year, which will set out the policy framework for Heathrow’s final planning submission.

John Holland-Kaye, Chief Executive of Heathrow said: “Heathrow is proud of its role as a gateway to these vital Chinese markets; enabling global trade as the UK’s largest port by value, acting as a catalyst for thousands of jobs for the local community and contributing billions to the UK economy. Expansion of Heathrow is a chance to deepen relations between China and the UK; as the report highlights, just one extra route could contribute hundreds of jobs and millions to the UK’s GDP. As the country prepares to leave the EU and China’s economy continues to grow exponentially, this is an opportunity the UK cannot afford to miss.”

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