International Conference on Air Transport, Law & Regulation: Challenges for the MEA, Abu Dhabi 14-16 April 2009

Abdul Wahab Teffaha Secretary General - Arab Air Carriers Organization

Recession ? … Depression ?... &

A Bright Spot

In spite of a global crisis, Arab Aviation continues its growth

Air Transport is STILL a strategic asset .. Especially as an economic catalyst

Effects of the crisis on Arab Aviation An Aero-political gridlock .. almost!

Overview

In spite of a global crisis, Arab Aviation continues its growth

AACO Members and Industry RPKs and ASKs growth

Source: AACO

Gulf War 1

Asian Financial Crisis

9/11 Attack Gulf War

2

SARSGlobal Recession

Air Transport is STILL a strategic asset .. Especially as an

economic catalyst

Source: AACO, ACI

Passenger Numbers in Arab Airports and Growth

Top Five Growing Arab Airports

Source: AACO, ACI

Top 5 Airports Growth 2008/1998

Airport SSH SHJ HRG DOH (2008/2000)

DXB

Growth 616.5% 443.6% 403.6% 368.3% 284.7%

Arab Air Transport Market Size and Distribution of Traffic

Source: AACO, ACI, IATA

75.6 Million Pax 85.7 Million

Pax

102.6 Million Pax

113.7 Million Pax

Effects of the crisis on Arab Aviation

IATA Industry Forecast

Source: IATA, EIU

Global passenger kilometers flown

1000

2000

3000

4000

5000

6000

7000

1980 1984 1988 1992 1996 2000 2004 2008 2012 2016

Bill

ions

14% lower

Pre-crisis industry forecasts (ICAO FESG)

Revised IATA forecast

1980-82 1991-93 2001-03 2008-10

17% lower

16% Lower

5% Lower

+4% over 2008

Source: AACO

AACO Members RPKs Forecast

Arab World and Industry GDP and RPKs Growth

Source: AACO, IATA, IMF

AACO Members Traffic Share on Inter-Regional Routes

Source: AACO

An Aero-political gridlock .. almost!

Two Arab liberalization agreements ..not really implemented: the main driving force for liberalization is national agendasNational economic agendas vary depending on economic attributes .. Hence there is no predominant model that applies regionallyPrivatization & Liberalization of ownership also depend on national economic attributes

An Aero-political gridlock .. almost!

Regional approach can only be achieved through creating a critical mass of like minded countries

or .. By external affiliation

Conclusion

In spite of the bright spot .. The long term future of growth depends on structural aero-political change

Liberalization & Privatization will become priorities but not uniformly

Air transport will continue to be an engine for economic growth