Mideast’s aviation market is set to grow 5% annually until 2036

Dubai / Emirates Business

His Highness Sheikh Ahmed bin Saeed Al Maktoum, President of the Dubai Civil Aviation Authority, Chairman and Chief Executive, Emirates Airline and Group, inaugurated the 7th Arab Aviation Summit held on Wednesday at the Roda Al Bustan Hotel in Dubai. Themed “Time to Transform: Addressing sustainability challenges and opportunities for the regional aviation sector”, the summit was attended by more than 200 industry participants from 15 Arab countries.
The strong growth potential of the Arab aviation and tourism sectors, despite various challenges, has been highlighted by a number of leading industry authorities. According to IATA, the Middle East’s aviation market is forecast to grow 5 percent annually until 2036. Predictions demonstrate that the sector will witness an extra 322 million passengers a year on routes to, from and within the region and the total market size will expand to 517 million passengers over this period. The region gained a 5 percent share of the global aviation market last year, flying 206.1 million passengers – an increase of 9.1 percent over 2015.
Welcoming the delegates to the summit, Adel Al Ali, Arab Aviation Summit Chairperson and Group Chief Executive Officer of Air Arabia, said: “We gather every year to debate the ever changing state of the aviation industry and its complexities. Arab aviation is highly affected by the evolving geo-political situation, the global economy, technological develop- ments and others. Our region is witnessing constant development and the theme for this year’s edition, ‘Time to Transform’, reflects this fact. Today, we address the sustainability of our industry and the challenges and opportunities it faces in the short and long term.”
According to Airbus’ Global Market Forecast, released this year, the fleet size of operators in the Middle East is forecast to more than double from 1,250 to 3,320 aircraft over the next two decades. By 2036, there will be 95 mega-cities, catering to 98 percent of the world’s long-haul services. The five mega cities existing today in the Middle East will more than double to 11 over the next 20 years. The Middle East’s aircraft maintenance, repair and overhaul (MRO) segment is another bright spot, growing at a faster pace as compared to the global average and generating thousands of jobs. It is forecast to double by 2025, rising at 7.4 percent per annum to reach $10.2 billion over the next decade.
The summit discussed key shifts in business models driven by economic borders, consumer demands and cost pressures and how market forces are driving the next evolution of Arab aviation. Abdul Wahab Teffaha, Secretary
General, Arab Air Carriers Organization (AACO) said: “Developing the aviation industry, which contributes directly to economic growth, creates jobs and business opportunities in almost all sectors, is what makes it exciting. But this will not happen by protectionism or by blocking key players from global and regional markets. As we face many present day challenges including air traffic management, sky liberalisation, rising taxes and charges, secondary airports among others, we need to work together to bring more social and economic benefits to the Arab world.

‘We need to learn from Dubai as it has created its own culture. Its government has subscribed not only to open skies but to openness to everything. We have tried protectionism and failed because it creates inefficiencies. Dubai has succeeded due to openness and the removal of the idea of protectionism.”
Through high-level dialogues, speeches, panel discussions and interactive workshops, the summit provides key insights to deal with market dynamics shaping Arab aviation and tourism. Key findings and outcomes will subsequently be developed into a white paper and presented to regulators and decision makers as a key reference point and course of action.
This year alone has seen several changes that have impacted the aviation and tourism sectors including air traffic management, rising taxes and on-ground infrastructure. These have brought about key shifts in business models driven by economic changes, consumer demand and costs pressures. The summit delineates how market forces are driving the further evolution of Arab aviation and how greater collaboration between public and private sectors can be achieved to unlock the region’s potential. Samir Al Darabi, Director of United Nations Information Center (UNIC) for Gulf States gave the keynote address on ‘Arab travel and tourism between world peace, culture and the global economy.’ He said: “This year, we aim to highlight the contributions of aviation and tourism and its economic impact on the Arab world. We will also address key challenges facing the regional industry including geopolitical changes, air management and open sky policies and fluctuating oil prices. Data from WTO proves that aviation and tourism industries have continued to create job opportunities globally. This year is the 7th continuous year of the global growth of aviation and tourism industries. The UN emphasises sustainability in all operations and under our ‘Change for Good’ initiative, we have contributed to international peace and well-being. More than 70,000 tonnes of relief supplies and 95 percent of emergency medical supplies are transported by air to the needy every year.”
Other speakers included Ghaith Al Ghaith, CEO of flydubai; Stefan Pichler, CEO, Royal Jordanian; Jef Wilkinson, CEO of Joramco; Eoghan O’ Driscoll, Chief Technical Officer of Dubai Aerospace Enterprises; Ahmed Qinawi, General Manager of MSI Aircraft Maintenance; and Bikram Pattanaik, Senior Managing Consultant, Global Products and Solutions at Mastercard.
Arab Aviation Summit is an industry initiative driven by support from the public and private sector. The initiative is considered the voice of the industry and it acts as a positive force behind driving the Arab travel and tourism industry forward. The summit’s mission is to improve the state of travel and tourism in the Arab world by facilitating a constructive dialogue for public-private cooperation.