LONDON (AFP) - London's Mayor Boris Johnson on Monday proposed shutting Heathrow airport, one of the busiest in the world, and replacing it with a major new hub to the east of the capital.

Setting out three proposals to end Britain's chronic shortage of air capacity, Mr Johnson said a new four-runway airport would create thousands of jobs and allow London to compete with rival international transport hubs.

"For London and the wider UK to remain competitive, we have to build an airport capable of emulating that scale of growth," he told a press conference.

"Anyone who believes there would be the space to do that at Heathrow, which already blights the lives of hundreds of thousands of Londoners, is quite simply crackers."

Despite being one of the world's busiest airports, Heathrow in west London has only two runways and is running at 98.5 per cent of its capacity.

For years politicians have wrestled with contentious plans to give Heathrow another runway, with Mr Johnson among those arguing that the noise and air pollution would be intolerable for people who live nearby.

On Monday, he put forward three alternative locations for a new four-runway hub, including his long-touted proposal to build an airport on an artificial island in the River Thames, dubbed Boris Island.

The other two ideas are to expand Stansted airport northeast of London, which currently has one runway, and to build an airport on the Isle of Grain in Kent on the River Thames.

The new hub could open by 2029 and would cost approximately £20 billion (S$90 billion) including the construction of road and rail links to the airport, Mr Johnson claimed. "Of all the three, I still think the Isle of Grain seems to me to combine the regeneration with the connectivity and with the ease of communication to London," said Mr Johnson.

He added that British politicians had been "sitting around like puddings for the last 40 years doing nothing" while rival countries built up their air capacity.

Up to 100,000 homes could be built on Heathrow's site as well as a new university campus, the Conservative mayor suggested.

In May, lawmakers on parliament's Transport Committee rejected the "Boris Island" plan and instead backed the expansion of Heathrow.

A new hub to the east would not be possible without vast public investment in the road and rail system, the committee said.

Mr Johnson will submit the plans this week to the government-appointed Airport Commission, which is due to give its recommendations on the future of British air transport in 2015.