By Tamara Walid
The net profits of Middle Eastern airlines is expected to arrive at less than half or US$200m in 2007 compared to the earlier forecast of US$500m, a recent report released by the International Air Transport Association (IATA) predicted.
The net profits of Middle Eastern airlines is expected to arrive at less than half or US$200m in 2007 compared to the earlier forecast of US$500m, a recent report released by the International Air Transport Association (IATA) predicted. The report added that Middle East airlines have doubled their share of global passenger capacity in a period of three years.
The report also suggested that the success of Dubai's Emirates Airline has single-handedly forced other airlines into this troublesome state, explaining that while Emirates earned US$674m in net profit last year, the Middle East region as a whole posted a US$200m profit, signifying widespread losses among other airlines.
"Emirates did very well but other airlines are still in build-up phase and making losses," an IATA spokesman told a local newspaper. The association had not provided an explanation of why the regional outlook had been lowered since its last report in June, but expected a slight improvement to occur in 2008, when Middle East airlines will earn US$300m in profit.
"Airlines in the Middle East have grown strongly over the last three years, increasing their share of global passenger capacity from around 4% in 2003 to nearly 8% in 2006," IATA said, adding: "Though still relatively small in global airline terms, the Middle East continues to be one of the most dynamic regions for airline growth."For all the latest transport news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.