China to displace US as biggest aviation market

• Global air traffic to hit 8.2 billion in 2037, says IATA

The International Air Transport Association (IATA) revealed that present trends in air transport suggest passenger numbers could double to 8.2 billion in 2037.

The latest update to IATA’s 20-Year Air Passenger Forecast, shows that an increasing shift Eastwards in the center of gravity of the industry is behind the continued strong growth. Over the next two decades, the forecast anticipates a 3.5% compound annual growth rate (CAGR), leading to a doubling in passenger numbers from today’s levels.

The Association warned, however, that growth prospects for air transport, and the economic benefits driven by aviation, could be curtailed if protectionist measures are implemented by governments.

IATA’s Director-General, Alexandre de Juniac said, “Aviation is growing, and that is generating huge benefits for the world. A doubling of air passengers in the next 20 years could support 100 million jobs globally”.

“There are two important things that stand out about this year’s forecast. Firstly, we are seeing a geographical reshuffling of world air traffic to the East. And secondly, we foresee a significant negative impact on the growth and benefits of aviation if tough and restrictive protectionist measures are implemented”.

This is coming as the Asia-Pacific region will drive the biggest growth with more than half the total number of new passengers over the next 20 years coming from these markets.

Growth in this market according to de Juniac is being driven by a combination of continued robust economic growth, improvements in household incomes and favourable population and demographic profiles.

He further disclosed that China will displace the United States as the world’s largest aviation market (defined as traffic to, from and within the country) in the mid-2020s.

The rebalancing of China’s economy towards consumption, he reiterated will support strong passenger demand over the long term, adding that India will take third place after the US, surpassing the UK around 2024.

To the group, Indonesia is forecast to be a standout performer—climbing from the world’s 10th largest aviation market in 2017 to the 4th largest by 2030. Thailand is expected to enter the top 10 markets in 2030, replacing Italy which drops out of the ranking.

He however stated that no matter which growth scenario comes to pass, aviation faces an infrastructure crisis.

The IATA chief urged governments to work work closely with the industry, to be more ambitious in developing efficient infrastructure, fit for purpose, and offering value for money.

“The world stands to benefit greatly from better connectivity. However, at this rate, airports and air traffic control will not be able to handle demand. Governments and infrastructure operators must strategically plan for the future. Decisions made now will have an impact on the value created by aviation for their regions,” said de Juniac.

The increased demand to fly, he noted creates a responsibility to expand in a sustainable manner.

To him, the aviation industry remains committed to its goals of carbon-neutral growth from 2020 onwards and cutting CO2 emissions to half 2005 levels by 2050.

“Commercial aviation is one of the only global industries to take on such comprehensive environmental targets. With mandatory emissions reporting beginning on January 1, 2019 under the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), this will help rally the industry to invest in more fuel efficient aircraft and sustainable aviation fuels,” said de Juniac.

Wole Shadare