International Air Transport Association (IATA) CEO and director general Giovanni Bisignani is holding up Mauritius as an example to the world in air transport liberalisation and is urging the Indian Ocean island state to take a leading role in air transport liberalisation, efficiency and environment issues.
Speaking in Port Louis, Mauritius, yesterday, the often-blunt Bisignani said air transport brings enormous economic benefits and “nowhere is that more evident than in Mauritius where air transport is the backbone of the tourism industry”.
Bisignani also praised the leading role the country played in this past weekend`s “Agenda for Freedom” summit in Istanbul Turkey.
“Mauritius brought a great story to our Agenda for Freedom summit this past weekend,” he said.
“The courageous decision of the Government in 2006 to open its aviation market invited new competition that boosted tourism and strengthened the national carrier. This shows that carefully planned liberalisation can deliver broad economic benefits even in the case of isolated island nations where the national carrier plays a critical role in national development.
“Mauritius brought a unique perspective to the meeting and is a great example for other governments to follow.
The summit started a process of working towards increased commercial freedoms in the areas of market access and ownership while maintaining a level playing field for airlines to compete fairly. The goal is to modernise the 60-year-old bilateral system that governs international air transport to create a stronger industry that can even better fulfil its role in economic development.
Bisignani says after losses of US$42 billion between 2001 and 2006, the airline industry returned a US$5.6 billion profit in 2007, equal to a 1% return.
“IATA forecasts the industry will post a global loss of US$5.2 billion 2008.”
“The return to the red is a result of extraordinarily high oil prices in the first three quarters of the year, and fall-off in demand beginning in July-August,” he said.
Last week IATA announced global traffic figures for September showing a 2.9% decline in passenger traffic and a 7.7% drop in cargo. “What we are gaining from lower oil prices, we are suffering in reduced revenues as the credit crunch evolves into a global economic crisis,” said Bisignani.
At the IATA Annual General Meeting held in Istanbul in June, IATA`s 230 member airlines issued a declaration calling for broad change in all aspects of the industry, to match airline efforts that have seen a 19% improvement in fuel efficiency, an 18% drop in non-fuel unit costs and a 25% decrease in sales and marketing unit costs.
The Istanbul Declaration urged labour to understand the need for change, monopoly service suppliers to improve efficiencies and governments to regulate monopolies, improve infrastructure and expand commercial freedoms.
Bisignani also held up Mauritius as an example in IATA`s “Simplifying the Business” (StB) programme.
“On 4 October 2008 the IATA e-freight programme went live between Mauritius and London. Mauritius is the first African state to take such a leading role modernising cargo processing by driving paper out of the processes,” said Bisignani.
IATA e-freight will deliver US$1.2 billion in savings by replacing paper with electronic documentation. Air Mauritius is bringing the benefits of StB to make Mauritius a more convenient and more competitive destination for both cargo and passenger traffic. “Air Mauritius met the e-ticketing deadline in June, it is using bar coded boarding passes. And it is looking at implementing common-use self service kiosks for check-in,” said Bisignani.
“The aviation industry is in a crisis and change is critical to build a sustainable future. That means commercial freedoms, efficiency, realistic taxation and an effective approach to environment. Mauritius is playing a role on the world stage in helping to drive many of these changes. At the same time I urge the government to re-consider the costs that it is adding to the industry with taxes and charges, including the Maurice Ile Durable tax and the State Trading Corporation transfer fee charged on fuel. Together they are nearly a US$12 million disincentive for tourism,” said Bisignani.
“With the right policy framework, aviation is a sustainable development mechanism. In Africa, aviation supports 430,000 jobs and US$9.2 billion in economic activity. And for every 10% increase in air transport utilisation, there is a 1% boost to GDP. I look forward to aviation continuing to play a strong role in the sustainable development of this great country—Mauritius,” concluded Bisignani