Dubai Airports CEO pushes for an open skies agreement with China to bolster growth

The chief executive of Dubai Airports, which oversees Dubai International Airport (DXB) and Al Maktoum International (DWC), is pushing for an “open skies” agreement with China to fuel growth of passengers flying via Dubai from the Asia Pacific region.

“The key thing with China is to get the Chinese government to agree that opening up the domestic [aviation] market for more international operations is going to be a very positive thing for them,” said Paul Griffiths.

Progress has so far been slow on persuading the Asian superpower to adopt such a policy, he said.

Dubai Airports expects to reach its target of just under 90 million passengers for 2017, Mr Griffiths said at the Dubai Airshow, adding that a significant portion of longer-term growth will be driven by China and South East Asian markets.

“If you look to 2024, there’s a projected increase of 1.3 billion passenger journeys from South East Asia, China, all those areas,” he said.

“This is where the real fuel for passenger growth is going to come from and we are very excited about this possibility because Dubai is at the heart of that. We are so well positioned geographically to be able to service that market.”

The UAE’s introduction last year of a visa-on-arrival policy for Chinese tourists will continue to facilitate growth in Chinese arrivals, but an open skies agreement is the key to unlocking the potential of that market.

“If China was to declare an open skies agreement we’d be in much better shape,” Mr Griffiths said.

“It means that one country declares to another that there is no restriction on the amount of flying that can be done by the airlines from both countries.

“That produces the best, most competitive product for the customer, the best pricing, and makes everything much easier. And it usually results in a huge uplift in the amount of trade, tourism and commercial activity between two countries.”

Mr Griffiths said when Dubai first started its journey to becoming an aviation hub, open skies agreements with nations were “a good way for us to develop”.

But he said that while talks on the matter had taken place between the UAE and Chinese governments, they had so far failed to reach a deal.

“Some countries are faster than others to embrace it. Australia is a good example [of one that did]. It embraced the idea that it doesn’t matter what airline people fly on, as long as they arrive, and they opened up bilaterals for tourism with explosive effects on the Australian economy. But other countries are lagging behind.

“The Chinese market has grown and obviously they have many years of experience of a huge amount of domestic travel, but they haven’t really got going in the international scene, until now.”

Dubai Airports’ 2017 passenger forecast comes despite an “unpredictable” year, according to Mr Griffiths, in which the volume of passengers from the United States declined and subsequently recovered. Volume from the GCC dropped by around 6 per cent year-onyear to date amid regional tensions.

“We started out this year predicting 90 million passengers but this year has been somewhat unpredictable in the way things have panned out,” he said.

“If you’d asked me in May or June, are you going to hit your targets, I’d have been less bullish than I am now.

“But we were fortunate to record in August an absolute bumper month, we got up to 8.23 million and that was the highest ever we’d recorded and the third month during 2017 where we’d had over 8 million passengers. So it’s been an exciting journey and we are very likely to get very close to our original target.”

Particular growth has come this year from Europe and eastern Europe, he said.