The International Air Transport Association (IATA) is due to discuss some of the economic and other challenges currently facing the aviation industry during the 68th IATA Annual General Meeting and World Air Transport Summit in China.
Some 650 delegates from among the association’s 242 members will be attending along with the senior management from many of the industry’s partners — aircraft and engine manufacturers, airports, air navigation providers and others — between June 10 and 12.
Prominent speakers at the meeting include the president and chairman of China Eastern Airlines, Liu Saoyong; Qatar Airways CEO Akbar Al Baker; Air Asia CEO Azran Osman-Rani; and Cathay Pacific CEO John Slosar.
“Our members are gathering here [Beijing] during some very challenging times. One of the toughest issues that we face is the high price of fuel and the state of the global economy,” IATA director general and CEO, Tony Tyler, said.
He said that today, fuel represented about 34 percent of average costs, while a decade ago that figure stood at 14 percent, showing how dramatically fuel costs had risen for airlines.
In addition, the situation was getting worse, especially in Europe, as the eurozone crisis had deepened.
“The European political landscape continues to change. Should the eurozone fall into a deep recession, the repercussions would be global,” he added.
Based on IATA’s forecast issued in March, European airlines were expected to lose US$600 million during the course of this year due to declining demand in the region while those in Asia were predicted to make the largest gains, he said.
Asia-Pacific airlines are expected to make the largest profits of $2.3 billion, followed by North America and the Middle East with $900 million and $500 million, respectively.
Latin America may see the smallest profit margin compared to other regions, with $100 million. Similarly to Europe, African carriers are also projected to suffer losses, of around $100 million, this year.
“On Monday, we will announce a revised outlook. It will take into consideration the risks in oil and the eurozone as well as the positive impact of very strong traffic growth,” he added.
Moreover, one of the most topical subjects at the annual meeting would be the growing dispute over the European Emission Trading Scheme (ETS) within international aviation, he said.
China, Russia and the US were among more than two dozen countries that saw Europe’s plans as an attack on their sovereignty, he said.
“Even Europe recognizes that the best solution must be global coordination through the ICAO [International Civil Association Organization]. We can look forward to some lively discussions on how this might be achieved,” he continued.
Additionally, IATA will have a series of discussions focusing on doing business in China, social media for air transportation, the benefits of aviation, sustainable biofuels, and the development of a new distribution system.
Source: The Jakarta Post
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