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Thu 12 Dec 2013 12:17 PM

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MENA aviation market to grow 6.3% by 2017

In the next four years industry analysts forecast global passenger traffic will break through the three billion mark

MENA aviation market to grow 6.3% by 2017
(AFP/Getty Images)

The Middle East and Asia-Pacific are tipped to register the strongest growth for international passengers in the next four years amid forecasts that global passenger traffic will break through the three billion mark by 2017.

The International Air Transport Association (IATA), in its latest forecast, said the global airline industry is expected to see a 31 percent rise in passenger numbers between 2012 and 2017 – from 2.98bn to 3.91bn.

The emerging economies of the Middle East and Asia-Pacific will see the strongest international passenger growth, with compound annual growth rate (CAGR)  of 6.3 percent and 5.7 percent respectively, followed by Africa at 5.3 percent and Latin America hitting 4.5 percent.

Routes within or connected to China will be the single largest driver of growth, accounting for 24 percent of new passengers during the forecast period. Of the anticipated 227.4m additional passengers, 195m will be domestic and 32.4m will be international.

The Asia-Pacific region, including China, is expected to add around 300m additional passengers by the end of the current forecast horizon. Of these, around 225m, or 75 percent, are expected to be domestic passengers.

With 677.8m domestic passengers in 2017, the United States will continue to be the largest single market for domestic passengers, although it will add only 70m passengers over the forecast period (2.2 percent CAGR), the IATA said. This reflects the market’s maturity. China is firmly established in second place (487.9m passengers in 2017, or 10.2 percent CAGR.).

The US also will reclaim the top spot from Germany for international passengers by the end of the forecast period. Germany will add 27.2m passengers to the 149.4m recorded in 2012 (3.4 percent CAGR), while the US will add 28.2m international passengers, rising from 149.3m  in 2012 to 177.5m (3.5 percent CAGR) in 2017.

IATA director-general and CEO Tony Tyler said it was not surprising that the Asia-Pacific region, led by China and the Middle East, will deliver the strongest growth over the forecast period is not surprising.

“Governments in both areas recognise the value of the connectivity provided by aviation to drive global trade and development,” he said.

“Similar opportunities exist for developing regions in Africa and Latin America. To reap the benefit, governments in those regions will need to change their view of aviation from a luxury cash cow to a utilitarian powerful draft horse to pull the economy forward.”

Globally, aviation supports some 57m jobs and $2.2 trillion in economic activity.

Airline ancillary revenue will reach $42.6bn worldwide in 2013, according to a new study by IdeaWorksCompany, a research firm, and CarTrawler, an online car rental distribution system.

The CarTrawler Worldwide Estimate of Ancillary Revenue represents a massive increase of 89 percent from the 2010 estimate of $22.6bn, the firms said.

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