IATA air passenger forecast shows dip in long-term demand

30 November 2015 06:30 pm - 0 - {{hitsCtrl.values.hits}}

A A A

The International Air Transport Association (IATA) released its updated passenger growth forecast, projecting that passenger numbers are expected to reach seven billion by 2034 with a 3.8 percent average annual growth in demand (2014 baseline year). That is more than double the 3.3 billion who flew in 2014 and exactly twice as many as the 3.5 billion expected in 2015.

Previously, IATA forecast 7.4 billion passengers in 2034 based on a 4.1 percent average annual growth rate. The revised result reflects negative developments in the global economy that are expected to dampen demand for air transport, especially slower economic growth projections for China.

The five fastest-increasing markets in terms of additional passengers per year over the forecast period will be China (758 million new passengers for a total of 1.196 billion), the US (523 million new passengers for a total of 1.156 billion), India (275 million new passengers for a total of 378 million), Indonesia (132 million new passengers for a total of 219 million) and Brazil (104 million new passengers for a total of 202 million).

Seven of the 10 fastest-growing markets in percentage terms will be in Africa. The top 10 will be: Malawi, Rwanda, Sierra Leone, Central African Republic, Serbia, Tanzania, Uganda, Papua New Guinea, Ethiopia and Vietnam. Each of these markets is expected to grow by 7-8 percent each year on average over the next 20 years, doubling in size each decade.

In terms of routes, Asian, South American and African destinations will see the fastest growth, reflecting economic and demographic growth in those markets. Indonesia-East Timor will be the fastest growing route, at 13.9 percent, followed by India-Hong Kong (10.4 percent), Within Honduras (10.3 percent), Within Pakistan (9.9 percent) and UAE-Ethiopia (9.5 percent)

“The demand for air transport continues to grow. There is much work to be done to prepare for the seven billion passengers expected to take the skies in 2034,” said IATA Director General and CEO Tony Tyler.

“Economic and political events over the last year have impacted some of the fundamentals for growth. As a result, we expect some 400 million fewer people to be traveling in 2034 than we did at this time last year. Air transport is a critical part of the global economy. And policymakers should take note of its sensitivity. The economic impact of 400 million fewer travellers is significant. Each is a lost opportunity to explore, create social and cultural value and generate economic and employment opportunities. It is important that we don’t create additional headwinds with excessive taxation, onerous regulation or infrastructure deficiencies,” said Tyler.

Divergence among BRIC nations
A sizable gulf has opened up between the performance of air passenger markets in the BRIC economies (Brazil, Russia, India and China). China and India are growing fast, with annual growth this year-to-date of 12.5 percent and 16.5 percent, respectively. India has bounced back from a subdued 2014 and is seeing a strong increase in domestic frequencies. Although China’s growth rate has moderated, it is still on course to add an additional 230 million passenger journeys between 2014 and 2019.

This is more than double the other three BRIC nations put together. Brazil and Russia, by contrast, are struggling. Falling oil and other commodity prices are partly to blame. Economic sanctions have also affected the Russian economy. It is notable that airlines in Brazil pay some of the highest fuel charges in the world; bringing the country’s fuel policy in line with global standards would certainly be a boost for air transport.

Exciting prospects for Iran and Cuba
The prospects for more open travel between the rest of the world and Cuba and Iran offer exciting possibilities for business, tourism and development as diplomatic relations warm up. Of the two markets, Iran offers the greater potential. Although Cuba is the largest Caribbean country by population, passenger growth would be from a low base of five million passengers today to around 13 million by 2034, in the best-case scenario. Iran, by contrast, already has a market of 12 million passengers, mostly domestic flyers. If strong GDP growth is accompanied with a full normalization of international relations and the end to sanctions, the total size of the Iran market could be 43.6 million passengers by 2034.

“There is a great deal of scope for economic development in Cuba and Iran, and air transport can play an enormous role in that. Relative to their economic development, the people of Iran and Cuba fly less than the global average. In Iran, full integration in the global economy could mean a difference in passenger growth of around 13 million extra travellers a year,” said Tyler.

Trends in 10 largest air passenger markets
China is expected to overtake the United States as the world’s largest passenger market (defined by traffic to, from and within) by 2029. In 2034 China will account for some 1.19 billion passengers, 758 million more than 2014 with an average annual growth rate of 5.2 percent. Traffic to, from and within the US is expected to grow at an average annual growth rate of 3.1 percent that will see 1.16 billion passengers by 2034 (523 million more than 2014). India will displace the United Kingdom as the third-largest market in 2026, with Indonesia rising to number 5 in the world. Japan, Spain, Germany and France fall relative to their competitors, Italy falls out of the top 10, while Brazil moves from 10th place to seventh.

Order Gifts and Flowers to Sri Lanka. See Kapruka's top selling online shopping categories such as Toys, Grocery, Kids Toys, Birthday Cakes, Fruits, Chocolates, Clothing and Electronics. Also see Kapruka's unique online services such as Money Remittence,Astrology, Courier/Delivery, Medicine Delivery and over 700 top brands. Also get products from Amazon & Ebay via Kapruka Gloabal Shop into Sri Lanka

Comments - 0

Add comment
Comments will be edited (grammar, spelling and slang) and authorized at the discretion of Daily Mirror online. The website also has the right not to publish selected comments.

IATA air passenger forecast shows dip in long-term demand

Comments - 0

Add comment

RECOMMENDED

UDA owned land in Thalawathugoda; UDA Minister Prasanna Ranatunga under the spotlight for forceful occupation of reserved land

Loss-making SMIB faces political pressure in recovering loans

Baltimore Bridge Collapse: MV Dali, SL authorities anchored in mystery?

Has Sri Lanka become a potential hub for the illegal wildlife trade?

Spotlight on Moragahakanda Development Project Moragolla villagers lose livelihoods and down to one meal a day

Ambitious Sri Lankan jobseekers ‘trafficked into Ukraine war zones’

Western purple-faced langurs see blue!

Most Viewed in News

Suspicious death of 23-year-old woman at hotel sparks concerns

April 15 declared a government holiday

A US “Kaputa”, a Lankan “Nariya” and a Presidential “Feast”

Belgian traveller scammed in Kalutara

23 year old youth ends up having his testicles removed

Street food vendor arrested for verbally harassing foreigner

MIRROR CRICKET

How does CSK get best out of Pathirana?

Mendis, Mathews move up in ICC Test Rankings

Chamodi, Dewmi spins Sri Lanka U19 Women to big win

Amir, Wasim return to Pakistan national team

TODAY'S HEADLINES

100 Police personnel trained to target criminals operating on motorbikes

Catholic Church receives full report

Complaint lodged over Piumi Hansamali’s possession of Gota’s Range Rover

We are struggling with severe shortage of staff – Excise Chief

Mendis, Mathews move up in ICC Test Rankings

Security raised for Champions League ties after threat

SLA target four events at Paris Olympic Games

Chamodi, Dewmi spins Sri Lanka U19 Women to big win