The International Air Transport Association (IATA), in its report has disclosed that global air demand measured in Cargo Tonne-Kilometers (CTKs), slumped by 14.9 per cent in January 2023, when compared to the same period in 2022.

The association also said that the cargo volume declined among African airlines by 9.5 per cent within the same period.

According to IATA, global demand, fell 14.9 per compared to January 2022 (-16.2 per cent for international operations)

Capacity measured in available Cargo Tonne-Kilometers, (CTK) was up 3.9 per cent compared to January 2022.

This was the first year-on-year growth in capacity since October 2022. 

International cargo capacity increased 1.4 per cent, compared to January, 2022. 

The uptick in ACTKs reflects the strong recovery of belly capacity in passenger airline markets offsetting a decline international capacity offered by dedicated freighters. 

The global new export orders component of the manufacturing PMI, a leading indicator of cargo demand, increased in January for the first time since October 2022.

For major economies, new export orders are growing, and in China and the US, PMI levels are close to the critical 50-mark, indicating that demand for manufactured goods from the world’s two largest economies is stabilising.

Global goods trade decreased by 3 per cent in December, this was the second monthly decline in a row.

The Consumer Price Index for G7 countries decreased from 7.4 per cent in November to 6.7 per cent in January. Inflation in producer (input) prices reduced by 2.2 percentage points to 9.6 per cent in December. 

”With January cargo demand down 14.9 per cent and capacity up 3.9 per cent, 2023 began under some challenging business conditions. That was accompanied by persistent uncertainties, including war in Ukraine, inflation, and labor shortages. But there is solid ground for some cautious optimism about air cargo. 

“Yields remain higher than pre-pandemic. And China’s much faster than expected shift from its zero COVID policy is stabilising production conditions in air cargo’s largest source market. That will give a much-needed demand boost as companies increase their engagement with China,” said Willie Walsh, IATA’s Director-General.

Asia-Pacific airlines saw their air cargo volumes decrease by 19 per cent in January 2023 compared to the same month in 2022. 

This was an improvement in performance compared to December (-21.2 per cent).

Airlines in the region continued to be impacted by lower levels of trade and manufacturing activity and disruptions in supply chains due to the residual effects of COVID restrictions that were imposed by China. 

Additionally, the positioning of the Lunar New Year would have impacted cargo volumes in January. Available capacity in the region increased by 8.8 per cent compared to January 2022.

North American carriers posted an 8.7 per cent decrease in cargo volumes in January 2023 compared to the same month in 2022. 

This was a slight decrease in performance compared to December (-8.5 per cent). Capacity increased 2.3 per cent compared to January 2022.

European carriers saw the weakest performance of all regions with a 20.4 per cent decrease in cargo volumes in January 2023 compared to the same month in 2022. 

This was a decrease in performance compared to December (-19.4 per cent). Airlines in the region continue to be most affected by the war in Ukraine. 

Capacity decreased 9.3 per cent in January 2023 compared to January 2022.

Middle Eastern carriers experienced 11.8 per cent year-on-year decrease in cargo volumes in January 2023. This was an improvement to the previous month (-14.4 per cent).

Capacity increased 9.6 per cent compared to January 2022.

Source: Independent

The Kenya Association of Air Operators (KAAO) Executive Committee hosted the Cabinet Secretary State Department of Transport and Roads Hon. Kipchumba Murkomen and Permanent Secretary Mohammed Daghar to deliberate on improving the partnership between Government and the private sector.

The meeting agreed on the need for industry input in major policy decisions affecting the sector to ensure there is a win-win outcome that supports growth and eliminates challenges bedeviling the industry.

This includes the involvement of the association in the development of the National Aviation Policy which is set to set the tone for Kenya as an integrated aviation hub to cater for all operators in the region including commercial/private/recreational air operators, approved training organizations (ATOs), approved maintenance organizations (AMOs), hot air balloon operators, and remotely piloted aircraft systems (RPAS) operators.

“The aviation industry has immense potential which, if exhaustively harnessed, will make Kenya an aviation hub and a force in the global market. We particularly recognize the important role the aviation sector plays in the tourism and horticulture sectors hence the need for an all stakeholder-led approach in policy making and infrastructure development prioritization,” CS Murkomen said in response to issues raised by KAAO.

KAAO also reiterated that the increasing number of taxes is negatively impacting the aviation sector in Kenya with the country standing out as the only State regionally and globally levying several taxes on aircraft, spare parts, and aviation fuel. According to KAAO Chief Executive Officer Liz Aluvanze such measures were making the local industry uncompetitive and unsustainable amid a surge in global and regional competition.

“This has led to a worrying decline in the development and growth of the sector resulting in job losses, migration of maintenance activities to neighbouring states, a decline of Kenya as a regional hub and overall decrease in revenue for the operators and government.”

KAAO also proposed that the government should prioritise the development of strategic airports and aerodromes based on demand and revenue generation channels to make them sustainable.

The industry lobby group also called for improvement of infrastructure in airports around the country including expansion of runways to ease congestion, new terminal buildings, reconstruction of pavements and aeronautical ground lighting, and development of parking silos and business parks. KAAO says this will help secure existing businesses and enable them to grow further,

“We are glad that we have open communication channels between KAAO and the Government. We purpose to cultivate a symbiotic relationship in order to achieve a safe, efficient, sustainable, and economically viable aviation industry,” She added.

Source: Africa Science News

Besides charging Nigerian air travellers exorbitant fares, aviation experts have raised concern over foreign airlines’ inability to repatriate trapped funds in Nigeria, insisting that Nigeria has become a country with the highest amount of foreign airlines’ trapped funds while highlighting its implications.

The implications according to them include the designation of Nigeria as a high-risk country in doing businesses related to aviation; the increase in insurance premium due to country risk and also the reluctance of lessors to lease aircraft to Nigerian carriers or to do so at very high cost.

Experts believe Nigeria having the highest amount of the trapped airlines’ funds is not good for the country because of the perception of Nigeria in global aviation industry.

Speaking, the Managing Director and CEO of Aero Contractors, Captain Ado Sanusi told THISDAY that said that the Maintenance, Repair and Overhaul (MRO) facility owned by Aero Contractors, benefit from credit guarantee extended to MROs by suppliers, but explained that this might be suspended because of the rising amount of trapped airlines’ funds in Nigeria.

He noted that in global reckoning, the policy or action taken by a country influences how the companies in that country are treated.

He said no matter the goodwill enjoyed by a Nigerian company, international financiers, lessors and aircraft insurers like Lloyd, may not deal with any company in Nigeria without considering policies and actions taken by the Nigerian government.

“This is why the designation of a country determines how airlines in that country are dealt with. If a country is designated as high risk, it influences the way companies in the country are perceived and related with. So if the trapped funds are not remitted to the airlines and the funds keep piling up, it is not good for the country.

“It will affect Nigerian airlines when they want to lease aircraft. Some lessors may not want to deal with the airlines because of country risk. They may ask the airline to pay almost two times what an airline in another county will pay for similar leasing arrangement. We have what we call consumables in aircraft maintenance. Suppliers give MROs credit facility up to $300, 000 to $400, 000 but when the look at Nigeria and they see the piling airline debts, they may decide not to extend the guarantee to Nigeria. They will term Nigeria a high-risk country, so they won’t give us credit facility,” Sanusi said.

The International Air Transport Association (IATA) on Tuesday disclosed that the trapped funds belonging to foreign airlines operating in Nigeria had reached $734,721,097 from $662 million in January 2023.

IATA disclosed this in a letter addressed to the Minister of Aviation, Hadi Sirika, and signed by the Area Manager West and Central Africa, Dr Samson Fatokun.

Nigeria has remained the country with the highest amount of trapped airlines’ funds and in December last year, IATA published the countries with the highest trapped funds as follows: Nigeria: $551 million, Pakistan: $225 million, Bangladesh: $208 million, Lebanon: $144 million and Algeria: $140 million.

IATA had warned that the amount of airline funds for repatriation being blocked by governments had risen by more than 25% ($394 million) in the last six months and disclosed that total funds blocked then tallied at close to $2.0 billion.

It therefore called on governments to remove all barriers to airlines repatriating their revenues from ticket sales and other activities, in line with international agreements and treaty obligations.

IATA is also renewing its calls on Venezuela to settle the $3.8 billion of airline funds that have been blocked from repatriation since 2016 when the last authorization for limited repatriation of funds was allowed by the Venezuelan government.

IATA’s Director General, Willie Walsh, said: “Preventing airlines from repatriating funds may appear to be an easy way to shore up depleted treasuries, but ultimately the local economy will pay a high price. No business can sustain providing service if they cannot get paid and this is no different for airlines. Air links are a vital economic catalyst. Enabling the efficient repatriation of revenues is a critical for any economy to remain globally connected to markets and supply chains.”

IATA also disclosed that airline funds were being blocked from repatriation in more than 27 countries and territories.

On Nigeria, IATA stated that the total airline funds blocked from repatriation in Nigeria as at December last were $551 million, stating that repatriation issues arose in March 2020 when demand for foreign currency in the country outpaced supply and the country’s banks were not able to service currency repatriations.

But IATA also noted that despite the challenges, Nigerian authorities have been engaged with the airlines and are, together with the industry, working to find measures to release the funds available.

“Nigeria is an example of how government-industry engagement can resolve blocked funds issues. Working with the Nigerian House of Representatives, Central Bank of Nigeria (CBN) and the Minister of Aviation resulted in the release of $120 million for repatriation with the promise of a further release at the end of 2022. This encouraging progress demonstrates that, even in difficult circumstances, solutions can be found to clear blocked funds and ensure vital connectivity, “said the Regional Vice President for Africa and the Middle East, IATA, Kamil Al-Awadhi.

Foreign airlines now discourage the purchase of tickets in Naira due to the trapped funds and for them to accept Naira as means of payment they up the price of the ticket.

So the foreign airlines have close their low inventory (low fares) and open their high inventory for Nigerians who wish to pay for tickets in Naira, while the low inventory are available in dollars.

Any Nigerian traveller who wishes to buy ticket at low rate, as sold by the airline to other countries, must pay for ticket in dollars; otherwise, an economy return ticket that could be sold for $700.00 could be sold for N2 million.

Source: This Day

As “record aircraft deliveries” make headlines in the Middle East and India market, the current supply chain constraints leave us wondering if the aircraft makers would be able to keep pace with the demand.

Despite a sluggish international travel market, the pace of recovery in the Middle East aviation market accelerated throughout 2022 and is expected to take off over the next 10 years with the region’s share of the global fleet set to expand. In its “Global Fleet and MRO Market Forecast 2023-2033,” global management consulting firm Oliver Wyman noted that the Middle East remains among the fastest-growing aviation markets in the world, with the regional fleet set to expand 5.1 percent annually over the next decade. The report further noted that the Middle East’s share of global fleet will grow over the decade from 4.9 percent in 2023 to 6 percent in 2033.  Meanwhile, the global fleet is projected to expand one-third by 2033, to well over 36,000 aircraft, with Oliver Wyman also anticipating a record number of aircraft deliveries over the next 10 years (despite current supply chain constraints). The Middle East fleet’s growth over the next decade will primarily be driven by the addition of narrow bodies. Historically, the Middle Eastern fleet has been primarily made up of widebodies. But moving forward, the report observed that narrow bodies will increase to 48 percent of the fleet from 39 percent, while wide bodies will decline to 48 percent from 56 percent.

Highlighting key travel trends to Saudi Arabia for the month coinciding with Ramadan, global travel marketplace Skyscanner noted that travellers from across the Gulf, UK, Egypt and Germany are amongst the most popular making their way to the kingdom during this time. With over 70 percent of travelers looking for trips between one and two-week long, Jeddah is the airport of choice, accounting for 75 percent of bookings. “As restrictions ease and capacity increases, we are seeing travel demand return to pre-pandemic levels, if not higher,” said Ayoub El Mamoun, Skyscanner travel expert. “Travel remains a key priority, with many travellers across the Gulf, such as the United Arab Emirates and Saudi, planning the same or more trips in 2023 than they did the year previously.”

Oman welcomed 2.9 million tourists in 2022, a 348 percent increase compared to 2021. The number of tourism projects and hotel establishments also increased relatively. This information was announced by Ibrahim Said Al Kharousi, undersecretary of the ministry of heritage and tourism in Oman. Al Kharosi was speaking at the Global Travel Week Middle East hosted by Oman. Around 200 luxury tourism specialists had participated at the event that sought to introduce tourism hotspots, exchange tourism experiences and reaffirm commitment to support and develop travel and tourism in the region. With the prime aim of showcasing Oman’s tourism potential, Global Travel Week sought ways to establish long-term relations between international markets and Gulf destinations, said Al Kharousi.

Dubai’s Department of Economy and Tourism has announced the relaunch of the Carbon Calculator tool that measures the carbon footprint within Dubai’s hospitality sector. The tool has now been revamped to track real-time data for carbon emission sources, allowing hotels to identify and effectively manage their energy consumption. The improvements are part of the Dubai Sustainable Tourism (DST) initiative that seeks to contribute to the broader clean energy targets and support the United Arab Emirates’ Net Zero by 2050 Strategy, in line with the United Nations Sustainable Development Goals (UNSDGs) 2030. The initiative also supports the goals of the Dubai Economic Agenda D33, to consolidate Dubai’s status as one of the top three global cities and enhance its position as one of the world’s leading sustainable tourism destinations. Since its inception in January 2017, Dubai Sustainable Tourism’s Carbon Calculator, part of the Tourism Dirham Platform, has been measuring the carbon footprint of hotels across Dubai.

Travel marketing platform Sojern shared its latest data highlighting that the Middle East continues to build on its strong travel momentum even in 2023. With relatively quick bouncebacks from Covid-19 in the United Arab Emirates, and Saudi Arabia seeking to secure its place on the tourist map with an ambitious visitor push, Sojern said the strong travel intent to the region would continue well into 2023. As of February, Sojern sees that 2023 flight searches are up year-on-year globally. With last year’s FIFA World Cup boosting travel recovery in the region, Sojern looks at the current state of play for travel now that the tournament dust has settled. The travel marketing platform noted that Qatar continues to ride the World Cup wave with particularly strong interest from Latin America. Lodging demand from regional Middle East travellers is also up 123 percent. Sojern also noted that over 75 percent of U.S. travellers are staying in the region for more than eight days. Compared to other long-haul destinations in Asia they are more willing to stay for over one week making them high-value travellers for Middle Eastern destinations.

Knowland, the provider of data-as-a-service insights on meetings and events for hospitality, announced its expansion in the Middle East to include Doha. Knowland’s extension into the Middle East will continue throughout 2023 to accommodate the demand and competition facing new hoteliers. Calling Middle East one of the fastest-growing hospitality markets in the world, Knowland said this has created several challenges including steep competition as well as the necessity to train sales teams who may have never worked in the hospitality industry. “The world’s largest active pipeline of new hotels is in the Middle East, so as we continue to build on the exciting growth in Qatar, we are also focused on expanding our reach throughout the increasingly popular region for local and global meetings and events,” Jeff Bzdawka, CEO of Knowland said. The company plans to open additional Middle East markets this year.

Hyatt shared that 45 percent of the properties that joined Hyatt’s system in 2022 were based in Europe, Middle East and Africa market and the region’s contribution to the Hyatt growth journey continues into 2023 through a strong pipeline with ten percent of Hyatt’s 117,000 rooms record pipeline, as of fourth quarter earnings, expected to join the portfolio in the region. Properties classified as lifestyle hotels make up nearly one fourth of the Europe, Middle East and Africa market pipeline, expanding the portfolio to more sought-after leisure destinations and strengthening the World of Hyatt value proposition. Notable drivers for the expected regional growth include several large-scale leisure portfolio integrations, adding a substantial number of rooms to the World of Hyatt program and the hyatt.com booking flow as well as organic growth for the Park Hyatt, Grand Hyatt, Hyatt Regency and The Unbound Collection by Hyatt brands slated for 2023 and the years ahead.  

Members of the Bureau International des Expositions (BIE) enquiry mission are in Riyadh for their 6-day evaluation process of the Riyadh Candidacy for World Expo 2030. Saudi Arabia announced its bid to host World Expo 2030 in Riyadh in October 2021 and, since then, senior Saudi government officials have made three presentations to the BIE General Assembly. The year 2023 will see key milestones for Riyadh Expo 2030 with the current enquiry mission visit, a presentation to the General Assembly in June and the final vote by the General Assembly in November 2023. Members of the enquiry mission will engage with ministers, members of government and subject matter experts, to evaluate the details of the Riyadh Expo 2030 bid. “Its theme outlines a vision to create a unique and collaborative platform for global problem-solving with an enduring legacy, led by foresight and geared towards delivering impact at a global scale,” a release stated.

Qatar Airways launched a new brand campaign in collaboration with Indian actor, Deepika Padukone. The campaign launch is the culmination of the airline’s endeavor to redefine Qatar Airways premium experience, particularly through showcasing the Q-Suite, the airline said in a statement. Calling Padukone an obvious choice, Qatar Airways Group Chief Executive, Akbar Al Baker, said, “She has the right global appeal and charisma for our brand.” Qatar Airways currently flies to more than 150 destinations worldwide, connecting through its Doha hub, Hamad International Airport.

Hotel management company Shaza Hotels has entered into a brand-wide agreement with WebBeds, a global marketplace for travel brands. Based on the agreement, WebBeds will undertake brand wide pricing and distribution globally for all Shaza and Mysk Hotels through their distribution networks, connecting travel agents and trave trade suppliers. This partnership will strengthen Shaza Hotels’ distribution network and expand its reach in the global travel market, the company said in a statement. Shaza Hotels also announced its ambitious expansion plans in the region, which includes the opening of properties in Dubai, Jeddah, Madinah, Sharjah and Muscat. The group said that it is also aiming to develop its Shaza and Mysk portfolio outside the Gulf region, to U.S., Turkey, Egypt and Levant.

Leading luxury hospitality company Four Seasons Hotels and Resorts announced plans to introduce a Four Seasons Resort as part of The Red Sea masterplan development in Saudi Arabia. Touted to be one of the region’s foremost luxury beachside destinations, The Red Sea will comprise idyllic natural islands and lagoons across 124 miles of coastline along the western coast of Saudi Arabia, between the cities of Umluj and Al Wajh. The new Four Seasons Resort will be located on Shura Island. “As we continue to expand Four Seasons presence in the region, our new project in the Red Sea will be one of our first resorts in Saudi Arabia,” said Bart Carnahan, president, global business development and portfolio management. The new Four Seasons Resort, designed by Foster + Partners, will offer approximately 149 rooms and suites.

Emirates and Philippine Airlines have signed an interline agreement to boost connectivity for passengers of both air carriers to new points on each other’s networks via Manila and Dubai, using a single ticket and one baggage policy. The partnership provides Emirates’ passengers access to 19 Philippine domestic destinations operated by Philippine Airlines, including Cebu, Cagayan de Oro, Bacolod, Cotabato, Davao, Iloilo, Kalibo and more, as well as two Asian regional points via Manila. Passenger of Philippine Airlines will also benefit from access to Emirates’ global network beyond Dubai. The partnership will help open new links for trade and tourism that will drive more inbound traffic into the market, and expand Emirates’ footprint in East Asia, said Adnan Kazim, Emirates’ Chief Commercial Officer, as he called The Philippines one of the strongest consumer markets for the airline.

Source: Skift