IATA: South Asia to be centre of gravity for airlines by 2036

GENEVA: The International Air Transport Association (IATA) finds the centre of gravity for the global airline sector shifting eastwards by 2036, particularly in South Asia.

IATA head of policy analysis James Wiltshire said growth in South Asian markets has been attracting commercial airlines to offer more services in the region.

He said the North Atlantic markets have historically been at the heart of global aviation, but now they would have to work harder to continue growing.

Wiltshire said there would be competition for services to make the most of the enormous potential in Asia for markets that want to connect to this emerging region.

“Aviation is a major enabler of economic activity and social cohesion. Air connectivity drives economic and social benefits.

“Air transport supports 65.5 million jobs and contributes to the creation of more than US$2.7 trillion (RM11.3 trillion) in gross domestic product,” he said at IATA Global Media Day 2018 recently.

He said air transport enables tourism and international trade, and encourages inwards investment, innovation, education and productivity, while promoting social cohesion.

“Connectivity is defined as the extent to which a country is integrated into the global air transport network, including the number of flights, seats and destinations.

“Many of the markets where connectivity has grown fastest are in Asia,” he said.

Wiltshire said a country that has the right framework in place, such as sufficient airport infrastructure (on the ground and in the air), cost competitiveness, and smart regulations as well as border processes would create stronger connectivity growth.

“The cost of air travel is the key driver for passenger demand. Excessive charges and burdensome taxes add to the cost of travel and inhibit connectivity.

“Regulations should only be implemented where necessary and proportionate, while visas add to complexity and cost,” he said.

IATA chief economist Brian Pearce said the centre of gravity of global commercial airlines is currently at the Gulf.

But in next 20 years, it will be heading to East Asia due to rising geographical advantages in the region.

“In the Middle East, we foresee that there are challenges, including conflict and business competition,” said Pearce.