Revenue and profit levels were uneven, though, across the globe, with developing and emerging markets expected to do better than developed economies, who would still outperform previous forecasts.
The industry group also lowered its estimate for 2009 to 9.4 billion dollars in losses, from the previous provisional figure of 11 billion in the red.
"It is still a red number, still a loss ... but it is something very very positive for the industry," Giovanni Bisignani, the head of IATA told reporters in Geneva, about the numbers for 2010.
Bisignani used the opportunity to lash out at unions, saying the still poor state of the industry meant that no salary increases should be demanded.
Further cuts might have to be considered, he said, adding it was "not the time" for strikes.
Both passenger and cargo demand were on the rise, but were still below levels reached just before the financial crisis, according to the latest estimates.
Air travel volumes were expected to go up 5.6 percent and freight by 12 percent.
IATA expected airlines would, however, need two to three more years before returning to pre-crisis levels.
Asia and Latin America were seen as leading the recovery and the latest figures showed they will respectively report 900 million dollars and 800 million in profits.
Meanwhile, North America was expected to see losses of 1.8 billion, while Europe will post a 2.2 billion dollars loss.
The African region would likely remain in the red by some 100 million dollars.
IATA called for increased liberalization of the industry to allow for consolidation, while warning that capacity and risks of large increases in the cost of fuel could yet further hurt airlines.
At least 34 airlines have gone into bankruptcy since 2008.
