IATA CEO Giovanni Bisignani believes the financial performance of Asian carriers is the worst in the industry and warns that countries in the region cannot rely on "debt-fuelled Western consumer spending to drive their economies".
Bisignani gave that assessment during a 19 March speech at the Malaysian Chamber of Commerce.
IATA in December projected a $1.1 billion loss for Asian carriers. "The shocking slowdown in Japan - the region's largest market, and China - the region's fastest growing make this forecast look optimistic," says Bisignani. "The global numbers are bad and the Asian numbers are a nightmare."
January traffic in the region fell 8.4%. Bisignani says that while the 4.3% capacity cuts were aggressive, "business is disappearing faster".
With Asia accounting for 44% of the cargo market, Bisignani says the poor cargo performance "is bad news for the region and global economy. World trade is falling off a cliff".
IATA is crafting strategies to help its members combat the world financial meltdown. Its e-ticketing initiative launched in June has delivered $3 billion in savings. "Our Simplifying the Business programme has identified $11 billion in additional savings by using technology to make travel and shipping more efficient and convenient," says the association's chief.
Bisignani says governments need to find policies that balance risks with stronger domestic and regional economies. "Until confidence returns to the global economy, tough times will continue," he warns.