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Sluggish airport infrastructure development threatens global aviation industry

Konstantin Sheiko
May 14, 2018

The global aviation industry is facing a clear-cut problem - infrastructure is not being built fast enough. As demand rapidly grows in many key places, the lack of infrastructural supply is causing significant challenges. If the global players won't have the proper capability to manage traffic in the air and at airports, the industry’s growth will be severely restricted. 

IATA, an organization that represents more than 275 airlines comprising of 83 percent of global air traffic, is calling for urgent attention to address the challenges in order to secure the industry's future. In addition, there are many worrying industry trends that are increasing costs. One of these is airport privatizations. The industry has not found the correct regulatory framework to balance the interests of the investors to turn a profit, with the public interest for the airports to be a catalyst for economic growth. 

The lack of airport capacity in such places as Jakarta, Bangkok, and Manila is one of the most pressing concerns in the Asia-Pacific region. Seoul’s Incheon airport meanwhile, provides an example that other airports might want to follow. The South Korean airport recently added a runway and terminal capacity without raising charges for airlines and passengers. 

In addition, Incheon has extended an airport charges discount introduced two years ago. Incheon airport's development model demonstrates a great understanding of the role aviation plays in linking the Korean economy to economic opportunities globally. The Singapore government is also showing great foresight with its expansion plans for Changi Airport. 

Ensuring sufficient and cost-efficient infrastructure in Asia-Pacific is a top priority, according to IATA. The region is center stage of the industry's overall growth. By 2036, IATA expects 7.8 billion people to travel globally, up from 4.3 billion expected in 2018. 

Of the expected 3.5 billion trips to, from or within the Asia-Pacific region in 2036, 1.5 billion will touch on China. As early as 2022, China will be the largest single aviation market. India is another emerging power-house, though it will likely take longer to mature, according to IATA.