Advise caution

zoom

Airports recorded strong growth in 2007 but the early signs from the first half of 2008 are causing concern.

Nearly 4.8 billion passengers arrived and departed the world's airports in 2007, a growth of 6.8% on the previous year. Airports Council International (ACI) recently released its full year 2007 World Airport Traffic Report, based on input from 1200 airports worldwide and it shows the industry is changing. The 2007 growth is a positive sign, but the report cautions that preliminary data from the first half of 2008 shows growth is easing.

ACI's director general, Angela Gittens believes figures for the first five months of 2008 could be a sign of difficult times ahead.

"Although we are still expanding, particularly in international traffic, we see some clouds on the horizon: slowing economies in certain nations and regions, the high price of fuel and airline financial difficulties, to name a few."

It is not all doom and gloom however. The industry is on track for a predicted nine billion annual passengers in 2020 and the 2007 traffic performance has also outpaced the increase in the global gross domestic product (GDP) of just over 5% in 2007. Add to this, long-term forecasts and the outlook remains positive, at an average of about 4% per year over the next 20 years.

High percentage growth rates dominate the picture in the Middle East. The fastest growth in passengers occurred in the Mid-East region with an impressive 11.3% increase.

International traffic growth in the region in 2007 was just behind the leader, Africa, at 8.5%. With the exception of Oman where the repositioning of Gulf Air led to a decline (-11.7%), the United Arab Emirates (UAE) consolidates its position as the biggest market. Dubai continues to rise at 19.9%, followed by Qatar (22.1%), Kuwait (13.9%) and Lebanon (20.7%).

As the fastest growing region in 2007, the UAE is dominated by Dubai and Emirates Airlines capitalising on both arrival and connecting traffic.

Lebanon has recovered from the aftermath of the military conflict in 2006 choking off demand temporarily, while Qatar is benefiting from thriving gas and oil markets and the strategy of its ambitious home carrier. Kuwait's figures show it is clearly enjoying the trend in oil price in addition to a more liberal aviation regime.

The report also reveals that nine out of the top ten fastest growing airports in 2007 are in Asia-Pacific. The fastest growing market for passengers is India with 24% growth and the largest single market in the world remains the USA, which handled 1.4 billion passengers last year.

The North America region shows the slowest growth at 3.5%, demonstrating the region's maturity as well as the capacity and congestion issues it faces. Overcapacity, a slowing economy, higher oil prices, the emerging mortgage crisis and route consolidations led to a slowdown, whereas international route expansion by US carriers and the cheap dollar stimulate traffic to and from destinations abroad.

Gittens' admits the figures reveal it is time for the sector to communicate on its work practices: "Industry insiders and observers alike agree that 2007's great performance will be tempered by the ‘Big O' - oil.

"With the impact of the highest fuel prices on record, the ‘credit crunch' and slowing economies, never has there been a more important time for our industry to pull together to share best practices and strongly advocate for our positions."

The trend for robust growth at small- and medium-sized airports outpacing growth at large airports continued in 2007 with the ‘under 5 million passenger' category growing almost three times faster than more congested and capacity constrained airports in the ‘over 40 million passenger' market category.

Print | Email | Discuss this article

| Share |

READERS' COMMENTS

Click here to post a comment

Add your Comment All posts are sent to the administrator for review and are published only after approval. ArabianBusiness.com reserves the right to remove any comment at any time for any reason. Please keep your responses appropriate and on topic. Arabian Business would like to point out that only comments relevant to the story will be published. Any containing personal insults or inappropriate language will not be approved.
Name *
Remember me on this computer
Email *	(Your email address will not be published)
City
Country
Subject *
Comment *
Notify me of further comments
Enter the words above *
Please click post only once - your comment will not be published immediately.

MORE FROM ARABIANBUSINESS.COM