The International Air Transport Association (IATA) estimates the volcano crisis economic impact on airlines is greater than the 2001 September 11 attacks.

Giovanni Bisignani, head of the IATA airline industry body, estimated airline revenue losses were now reaching $250 million a day, up from an earlier estimate of $200 million.

Bisignani added that the U.S. September 11 attacks had triggered a loss of confidence in air travel that was not present today. He also predicted that recovery from the current crisis would be quicker once the clouds dispersed. "We have predicted at least $200 million a day in lost revenue that is a conservative number. Today, that is more like $250 million. On top of this you have the additional cost for re-routing and compensation," he commented.

IATA also says the European governments' response to the volcano crisis was inadequate and Bisignani called for urgent action to safely re-open airspace. He called for a meeting of the International Civil Aviation Organization, the United Nations aviation body. "I would say that in a couple of weeks this will be a very embarrassing story for Europe," Bisignani told a news briefing in Paris.

"It took five days to organise a conference call with transport ministers with an emergency situation all over Europe and now expanding all over the world."

Most of Europe's airspace has been closed since last Thursday after a huge ash cloud from an Icelandic volcano spread out, stranding millions of business passengers and holidaymakers and paralysing freight and businesses worldwide.

"This volcano has crippled the aviation sector, firstly in Europe and is now having worldwide implications. The scale of the economic impact (on aviation) is now greater than 9/11 when U.S. airspace was closed for three days," Bisignani said.

Source: Commercial Aviation Online