Airlines recover from Arab Spring effects

The Middle East’s airlines have recovered from the nagative effects of Arab Spring, says Tony Tyler, director-general of International Air Transport Association (IATA). “The Middle East is one of just two regions that have seen their outlook boosted since December forecast and that is certainly a positive. The region as a whole also appears to be fully recovered from the negative effects on air travel of the 2011 Arab Spring,” he told an elite gathering of 500 aviation industry professionals at the Global Aerospace Summit, being held in the capital. Last month, IATA downgraded its airline profit forecast for 2012 from $3.5 billion to $3.0 billion, he said in his state of industry report. “We expect to generate revenues of $633 billion this year that means we will achieve a paltry 0.5 per cent profit margin on revenue growth of 5.8 per cent and traffic growth of 3.6 per cent.” The bottom-line impact of this is being moderated by some positive factors. Europe seems to have averted a financial meltdown, at least for now, he said. Most recent traffic numbers show that capacity is growing at a slower rate than demand, leading to rising load factors and some yield improvement, although at the risk of discouraging some price-sensitive discretionary traffic, Tyler said. Turning to the Middle East region, IATA sees a profit this year of $500 million, which is raised from our previous estimate of $300 million and represents a significant improvement compared to earnings of just $100 million last year.  Also, aviation’s role in the region is set to grow rapidly over the next two decades as international passenger numbers rise from 77.1 million in 2010 to 220.4 million in 2030. He lauded the UAE policy makers for boosting aviation industry which has made Dubai Airport as the world’s 13th busiest airport by passengers in 2011, with nearly 51 million passengers. The IATA chief asked for an effective, efficient, user-friendly and non-obtrusive. Speaking about hassle free Checkpoint of the Future initiative, he said it will screen using passenger data that is already being collected for immigration purposes, which with the use of technology will allow passengers to walk through checkpoints without stopping, disrobing or unpacking. He said the European Commission, China, the US Department of Homeland Security and Interpol have supported it . Moreover 16 countries have endorsed a statement of principles for such a checkpoint. The MENA region has invested more than $100 billion on airport projects, including $6.8 billion in Abu Dhabi, $14 billion on the new Doha International in Qatar and $33 billion on the new Al Maktoum International for Dubai.