Aviation contributes US$3.5 trillion to global economy but faces challenges – IATA

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The global aviation industry supports 33 million jobs and contributes US$3.5 trillion in economic activity, the International Air Transport Association says, urging greater cooperation and innovation in the aviation industry in order to drive economic growth.

“The global connectivity that aviation provides is the lifeblood of the global economy,” said Tony Tyler, IATA’s Director General and CEO in an address to the International Aviation Club in Washington yesterday.
“The world is thirsty for our product, giving us tremendous potential for growth and innovation. But there are no guarantees in turning that potential into reality…The industry value chain and governments must work even more closely together to ensure safe, secure, efficient and environmentally responsible air services.”
“In the decade ending this year, airlines will have safely transported over 23 billion people and nearly 426 million tonnes of cargo. Those amazing statistics are the result of our rich history of working together to address the fundamental challenge of safety with global standards that are consistently applied,” said Tyler.

Aviation has been targeted for its role in air pollution and its contribution to climate change. Tyler said that the industry has ‘ambitious’ plans to deal with environmental challenges and aims to cut net emissions in half by 2050 compared with 2005 levels. “Sustainable biofuels have the greatest potential to contribute to this goal, with up to 80% reduction in CO2 over the lifecycle of the fuel,” said Tyler.
“Unfortunately, the attention of governments is being distracted by Europe’s unilateral plan to include international aviation in its emissions trading scheme,” said Tyler who noted that Europe’s plans are coming under increasing pressure as states express their concerns over sovereignty issues.

The US is debating legislation to prohibit its carriers from participating and 26 states sponsored a declaration by the ICAO Council urging Europe’s governments to abandon their unilateral and extra-territorial plans and support the success of a global solution through ICAO. “I cannot think of another issue that touches international aviation, with the exception of safety, on which China, India, Russia, Japan and the US are in agreement,” said Tyler.

Under the European Union’s proposals, airlines would have to pay carbon taxes based on the total distances they had flown and not just the distances they covered over European countries.

Tyler identified three additional areas where cooperation and innovation are needed, including security. IATA urged governments to support innovation to improve aviation security with IATA’s Checkpoint of the Future vision. “Airlines and governments have spent at least a cumulative total of US$100 billion over the past 10 years on security. Unfortunately, for many of our passengers that investment has made security the single biggest point of dissatisfaction in the travel experience. It is often too slow, unpredictable and overly intrusive. IATA’s vision is for a Checkpoint of the Future that introduces a risk-based approach and uses technology solutions to allow a passenger to get from curb to gate without stopping to unpack or remove clothes,” said Tyler.

Regarding taxation, Tyler said that, “despite our vital economic role, politicians appear to value us more as surrogate tax collectors.” IATA strongly supports opposition to recent US proposals to double the passenger security fee and impose a US$100 charge on every aircraft that takes off. “The purpose is primarily to generate funds for the treasury at the expense of travelers. Strong and united opposition from the aviation stakeholder community awakened firm resistance to the proposals in Congress. We must continue to work together to persuade lawmakers and regulators to focus on aviation as a catalyst for economic growth and job creation. We cannot do that if we are being buried in taxes,” said Tyler.
“Our challenge with governments is not just taxation. We suffer equally, if not more, from bad regulations,” said Tyler. “Delays and flight cancellations are estimated to have cost the US economy some US$31.2 billion in 2008. Yet we see regulation that is meant to protect passenger rights actually provide incentives to airlines to cancel flights because penalties for extended delays are so costly.”



Tyler said that through cooperation and innovation, aviation can meet its challenges. “Under my watch, IATA will continue to be a strong advocate of industry issues. But IATA will be even more effective as a voice in a strong chorus of industry advocates than as a soloist. And of course the message will resonate more effectively with those we seek to influence if we are in alignment, in harmony and delivering results.”