Partnerships, innovation, key to maintaining rapid growth in Middle East Aviation

The International Air Transport Association (IATA) called for a renewed focus on cooperation among aviation stakeholders in the Middle East and North African (MENA) region to manage the challenges of growth.

“The story for the MENA region is growth. In 2004 MENA carriers accounted for less than 7% of international traffic. Today it is over 11%. The double digit growth trend of Middle East carriers over the last years has fueled this expansion. That has slowed this year. Over the first 10 months of 2011 Middle East carriers added 8.8% to capacity while demand grew by 8.0%. But the future for this region remains bright,” said Tony Tyler, IATA’s Director General and CEO.

Tyler’s comments were made at the Arab Air Carriers Organization (AACO) Annual General Meeting in Abu Dhabi, United Arab Emirates (UAE). As an example of the region’s growth, Tyler noted that the UAE is expecting 8.5% average annual growth through 2015. “If that materializes, in 2015 it will handle 86.6 million international passengers—nearly 30 million more than in 2010. And it will be the 8th largest market for international travel—only slightly smaller than China at 90 million passengers and well ahead of Japan at 70 million. This will be an extraordinary achievement,” said Tyler.

“Aviation is a challenging industry, so let’s work together, where we can, to meet the challenges of growth and make aviation even more successful. This includes working with important partners like AACO, other regional associations and those who represent our partners in the value chain–including the Civil Air Navigation Services Organization and Airports Council International,” said Tyler.

Tyler identified four key challenges to growth that must be addressed:

Safety: “Safety comes first. It is the industry’s top priority. The Middle East region currently is experiencing one Western-built jet hull loss accident for every 1.2 million flights compared to a world average of one for every 2.7 million flights. The challenge of raising the region to the world standard is made more complex with growth. Global standards are the way forward on safety. The region has done a good job of implementing the IATA Operational Safety Audit (IOSA). And it has taken a leading role with the implementation of the IATA Safety Audit for Ground Operations (ISAGO) with 27 of the 132 registrations in the MENA region. Along with being mandated by the government of Lebanon, relevant authorities in Kuwait, Jordan, the UAE and Oman have given ISAGO their endorsement. I encourage others to follow,” said Tyler.

Security: Tyler called on the region’s governments to support IATA’s Checkpoint of the Future initiative. “Security as we do it today works, but it is not sustainable given the growth in demand that we are expecting. The Checkpoint of the Future will take a risk-based approach to airport screening—eliminating the hassle and improving efficiency with technology and intelligence based on passenger information. Twelve states and Interpol have signed a statement of principles supporting the concept. So far none is from this region. I look forward to working with AACO to ensure that MENA governments become part of this global initiative,” said Tyler.

IATA also urged the region to move forward with Secure Freight—an IATA initiative to introduce a similar risk-based approach to secure the entire air freight supply chain. “Secure Freight means shippers, freight forwarders, airports, airlines and regulators working together on a multi-layered approach combining advanced electronic information and physical screening. The International Civil Aviation Organization (ICAO) is aligned with this vision. And it is already being implemented in the UAE,” said Tyler.

Infrastructure: “Airports across the region are being prepared for growth with $100 billion in investments. But I am concerned for the potential bottlenecks in the sky if air navigation service providers are unable to keep ahead of the traffic growth. The challenge is made all the more difficult because it must be accommodated with just 40% of the airspace permanently open to civil aircraft. The rest of the airspace is controlled by the military and under restricted access or off-limits to civilian aircraft. Cooperation in a coherent regional approach is needed to manage the growth safely and efficiently,” said Tyler. The priorities to ensure that air traffic management keeps pace with the region’s growth are (1) more route options, (2) harmonization of technology and operations and (3) flexible use of airspace in cooperation with the military.

Environment: “Environment also needs cooperation but with a global—not regional—approach. COP-17 began in Durban this week and aviation has a good story to tell, with commitments across the value chain to improve fuel efficiency by 1.5% annually to 2020, cap net emissions from 2020 and cut net emissions in half by 2050 compared to 2005 levels,” said Tyler.

Tyler reiterated the industry’s opposition to the EU Emissions Trading Scheme, which will distort markets and open the door to a patchwork approach of conflicting, competing or layered measures including taxation. “The industry supports market based measures. But they must be globally coordinated through ICAO,” said Tyler who also expressed concern over the EU’s promotion of the concept of equivalent measures negotiated on a state-by-state basis with no defined criteria. “Following such an approach would open the door to layered, conflicting and duplicated taxes and measures. It would be a nightmare for the industry and no substitute for a global approach under the leadership of ICAO.”

“My focus on running IATA is on delivering value and innovation and being responsive to the needs of the membership. Under my watch, you can expect the same great services from IATA in safety, managing the industry financial systems, advocating on your behalf and supporting issues that are critical to your business. On top of that, I will be challenging my IATA team to find innovative ways to deliver these services even more efficiently as technology develops and your needs evolve,” said Tyler.

Read Tony Tyler’s full speech