MENA region can gain from aviation sector, but connectivity and operating environment a challenge, IATA says

MENA passenger demand is set to expand by 5.7 percent each year on average over the next 20 years. (Reuters)
Updated 07 October 2017
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MENA region can gain from aviation sector, but connectivity and operating environment a challenge, IATA says

DUBAI: Middle East and North Africa (MENA) countries can hugely gain from the aviation industry but sectoral challenges should be addressed for the region to reap the benefits, an International Air Transport Association (IATA) official said.
“Aviation has the power to generate significant prosperity. A safe, secure, efficient and sustainable air transport industry pays huge social and economic dividends,” according to Muhammad Ali Albakri, IATA’s Regional Vice President for the Middle East & Africa.
Albakri said that while aviation currently supports 2.4 million jobs and contributes $157.2 billion (SR589.5 billion) in the region’s economic output, the “operating environment for airlines in MENA remains challenging.”
With passenger demand expected to grow 5.7 percent annually over the next 20 years, MENA region is to become a market of 380 million passengers by 2035.
As such, Albakri urged the region’s governments to address key challenges regarding aviation infrastructure, rising taxes and charges, security and regulations.
“Studies show that the average ATM delay in the Gulf is 29 minutes with the potential to double by 2025. And the diplomatic row in the GCC has further exacerbated the problem,” Albakri said. “Without an increase in the overall efficiency of the ATM systems in the region through improved airspace design, MENA’s world-class hubs will be compromised with gridlock … Regional governments cannot allow their geographical fragmentation and political complexity to get in the way of finding a long-term solution.”
Albakri also said the slew of new charges and taxes in the Middle East resulted into additional $1.6 billion costs in 2015 and 2016 that the aviation sector had to shoulder.
“Excessive taxes and charges affect the ability of aviation to meet demand and impede economic growth. Governments will earn more revenues in the long-term by promoting aviation through lower taxes … Every dollar that a passenger spends in the region creates jobs and spreads prosperity. And every dollar collected in taxes or charges is an incentive for travelers to go elsewhere. We must work together to reverse this trend,” Albakri said.
Albakri likewise highlighted the further need to keep air travel secure, considering the recent US ban on large personal electronic devises have inconvenienced passengers and airlines.
The IATA likewise urged MENA governments to adopt the group’s Smarter Regulation framework “to avoid unintended consequences when designing or implementing aviation policies.”
“Smarter Regulation is the solution to achieve positive policies that support the growth of aviation and ultimately boost social and economic development,” said Albakri.


German industry groups warn US on tariffs before Trump-Juncker meeting

Updated 45 min 35 sec ago
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German industry groups warn US on tariffs before Trump-Juncker meeting

  • Washington imposed tariffs on steel and aluminum imports from the EU, Canada and Mexico on June 1
  • Trump is threatening to extend them to EU cars and car parts

BERLIN: German industry groups warned on Sunday, before European Commission President Jean-Claude Juncker meets US President Donald Trump this week, that tariffs the United States has imposed or is threatening to introduce risk harming America itself.
Citing national security grounds, Washington imposed tariffs on steel and aluminum imports from the EU, Canada and Mexico on June 1 and Trump is threatening to extend them to EU cars and car parts. Juncker will discuss trade with Trump at a meeting on Wednesday.
“The tariffs under the guise of national security should be abolished,” Dieter Kempf, head of Germany’s BDI industry association said. Juncker should tell Trump that the United States would harm itself with tariffs on cars and car parts, he told Welt am Sonntag newspaper.
The German auto industry employed more than 118,000 people in the United States and 60 percent of what they produced was exported. “Europe should not let itself be blackmailed and should put in a confident appearance in the United States,” he added.
German Economy Minister Peter Altmaier told Deutschlandfunk radio on Sunday he hoped it was still possible to find a solution that was attractive to both sides. “For us, that means we stand by open markets and low tariffs,” he said
He said the possibility of US tariffs on EU cars was very serious and stressed that reductions in international tariffs in the last 40 years and the opening of markets had resulted in major benefits for citizens.
EU officials have tried to lower expectations about what Juncker can achieve, and played down suggestions that he will arrive in Washington with a novel plan to restore good relations.
Altmaier said it was difficult to estimate the impact of any US car tariffs on the German economy, but added: “Tariffs on aluminum and steel had a volume of just over six billion euros. In this case we would be talking about almost ten times that.”
He said he hoped job losses could be avoided but noted that trade between Europe and the United States made up around one third of total global trade.
“You can imagine that if we go down with a cold in the German-American or European-American relationship, many others around us will get pneumonia so it’s highly risky and that’s why we need to end this conflict as quickly as possible.”
Eric Schweitzer, president of the DIHK Chambers of Commerce, told Welt am Sonntag the German economy had for decades counted on open markets and a reliable global trading system but added: “Every day German companies feel the transatlantic rift getting wider.”