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Improving the Middle East's aviation safety record

The head of IATA looks at what can be done to improve aviation safey.
Bisignani says the region's aviation safety record is worsening.
Bisignani says the region's aviation safety record is worsening.

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The following is an edited extract of IATA director general Giovanni Bisignani's recent address to the Arab Air Carrier's Organisation. 

After a horrible decade with cumulative losses of $50 billion, airlines are now returning to profitability at a global level. We have upgraded our forecast to an $8.9 billion profit for 2010. The upturn has been stronger and faster than anticipated.

Traffic is already 2-3% above pre-crisis levels of 2008 and yields have risen between 7 and 8% this year. However, 2011 will be different. The inventory re-stocking cycle that drove growth this year is completed and we must now rely on consumer demand to achieve a sustainable recovery.

We see capacity growing by 6% ahead of a 5% demand improvement. Yields will stop growing and profitability will fall back. Aviation remains a fragile industry with $210 billion in debt.

Let’s take a closer look at the Middle East and North Africa (MENA) region. Between 2009 and 2010, the bottom line for the region’s carriers improved by $1 billion to a profit of $400 million.This year, we expect demand growth of 21% from passengers and shippers while capacity will only increase by 15.9%. This balance will shift in 2011.

Capacity will grow at 10.6%, faster than the expected 10.4% increase in demand. In line with the global trend, the region’s profits will fall back to $300 million. The hard work of running airlines continues.

MENA is growing. Over the last decade its carriers went from 5% of global passenger traffic to 11%. Planned purchases of $200 billion in aircraft over the next decade will continue to support growth. An expanding global presence brings the challenge of playing a larger and more important role in the global aviation community. This includes the key areas of safety, infrastructure, government involvement and environment.

Safety is our top priority and the numbers tell the story.

The 2009 hull loss rate for Western-built jets was 0.71 accidents for every million flights. This is a 36% improvement over the last decade. We can be proud of being the safest mode of transport. But I have concerns in MENA. You had no Western-built jets hull losses in 2006. But in 2009, this jumped to 3.32 accidents per million flights, 4.6 times worse than the global average. The region’s rapid growth must be accompanied with a strong safety record.

IATA’s Operational Safety Audit (IOSA) is the global standard for managing operational safety. Already, 35 carriers in the region are on the registry, including all 26 IATA members. Egypt was the first government to mandate IOSA. Lebanon, Syria and Bahrain joined later and Jordan is expected to join soon. I challenge all governments to take advantage of IOSA.

I congratulate the region for its leading role on improving ground safety with IATA’s safety audit for ground operations (ISAGO). Thirteen MENA-based ground handlers are on the ISAGO registry. We have formal support from Kuwait, Jordan and Oman, and ISAGO will be mandatory in Lebanon from June 2011. IOSA and ISAGO are key global standards to make flying even safer in the air and on the ground.

Infrastructure is critical to support growth. MENA’s record is impressive. Governments and industry are supporting effective air links with strategic investment. But what is being built and planned on the ground is not being matched in the air. Over 60% of the airspace in the Gulf area is restricted to civilian aircraft. This limits airspace capacity and flexibility and forces airlines to operate inefficient routings.

In the Gulf, we are working with governments on a regional airspace redesign. In North Africa, we are developing capacity for rapidly growing East-West traffic. To support the region’s ultra-long haul operations such as Sao Paolo to Dubai, we recently announced iFlex.

The flexibility to operate such routes with optimum conditions can save 2% fuel burn and 5-10 minutes flight time. Finally, over the next year, we will complete MENA’s reduced vertical separation minima implementation by bringing Iraq on board. All of these initiatives will deliver real efficiencies that support the region’s growth.

Technology also supports growth by improving efficiency. Together, we achieved 100% e-ticketing in 2008 and later this year, we will celebrate 100% bar coded boarding passes. I congratulate the region: airlines are 92% complete and airports are at 90%. Airports in Abu Dhabi, Dubai, Bahrain, Muscat, Doha, Kuwait and Sharjah have Platinum status for reaching 100% already.

E-freight is also making progress with Dubai and Egypt on board. The UAE is a global top performer and over one third of all international e-freight shipments are by Emirates. E-freight is providing a competitive advantage. The hurdle is adapting local regulations to facilitate modern business practices.

Aviation’s growth in MENA is delivering economic benefits to the region. To maintain these benefits, governments must help keep costs down by controlling taxes and charges. This region has almost limitless opportunities to build its future by meeting the challenges of growth that I have outlined. I look forward to developments in this region that will make it an even stronger player in an industry that is safer, greener and more profitable.

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