(Yicai Global) March 1 -- The Civil Aviation Administration of China has refuted claims that Shanghai has plans in the pipeline for a third airport.

The eastern megacity now has two airports, Hongqiao and Pudong. Their upper limit of annual traffic is 120 million passengers. They transited over 110 million passengers last year, so strain on their capacity is already looming on the horizon. 

"The Civil Aviation Administration of China has not received any application from Shanghai to choose a site for a third airport. The national civil airport plan does not include a third Shanghai airport," Gu Xiaohong, the deputy director of CAAC's Department of General Affairs, thus dismissed rumors of a third Shanghai airport in a press conference today, state China News Agency reported.

The city is still choosing a site for the third airport, and the candidates include Haimen prefecture of Nantong, Jiangsu province, and Shanghai's Chongming and Fengxian districts, a source with the CAAC's East China Regional Administration told Yicai Global in February.

The CAAC will, as always, support and promote the coordinated development of civil aviation in the Yangtze River Delta and help develop Shanghai's large international hub airport, Gu said at the press briefing today. 

The CAAC will optimize the structure of the Shanghai airline network, improve the distributive function of the city's aviation hub, and work on alternative flights to divert traffic to enhance the international competitiveness of these hub airports, Gu said.

The airport would greatly improve the local employment and land value around it, Li Xiaojin, an experienced civil aviation specialist, told Yicai Global. "An airport's boost to the local economy is desirable, but some airports in remote areas are left idle after they are built. They do not play their role because of market positioning and research issues," Li said. 

A third Shanghai airport would be very close to the city, so the source of passengers would present no problem. It and its surrounding cities need to consider how to choose an optimum location, and at the same time coordinate this well with high-speed rail, Li added.

Editor: Ben Armour