IATA cuts air cargo traffic growth rate due to US-China trade row, Brexit
THE International Air Transport Association (IATA) has halved its annual forecast for air cargo traffic growth to two per cent - down from 3
THE International Air Transport Association (IATA) has halved its annual forecast for air cargo traffic growth to two per cent - down from 3.7 per cent forecast in December - citing trade frictions, Brexit and anti-globalisation rhetoric, and leaving airlines more dependent on passenger revenue for growth, reported Reuters.
'Developments in the political climate are not going in our favour,' IATA director general Alexandre de Juniac was quoted as saying at an air cargo conference in Singapore.
IATA said weaker global economic activity and consumer confidence triggered a 1.8 per cent drop in global air freight traffic in January, marking the worst monthly performance in three years.
Air cargo traffic last year rose by 3.5 per cent, far below the 9.7 per cent growth during a re-stocking cycle in 2017.
Asian airlines have an outsized role in airfreight, accounting for 40 per cent of the global market because the region is a manufacturing and e-commerce hub.
IATA last week said air cargo demand in Asia declined by 3.6 per cent in January on account of weaker manufacturing conditions for exporters in the region, continuing trade tensions and a slowing Chinese economy.
Association of Asia Pacific Airlines director general Andrew Herdman said e-commerce remained strong but slowing export orders has dragged down overall cargo demand.
'The first quarter looks weak from a macro-economic outlook but as for the rest of the year it very much depends on whether these trade disputes drag on or whether there are some resolutions,' he told Reuters in an interview.
Cathay Pacific Airways, Air China and Singapore Airlines - ranked among the world's top 10 cargo airlines - reported lower demand for international cargo during January.
'The air cargo industry continues to face challenges from the evolving world trade tensions,' Singapore Airlines CEO Goh Choon Phong said. 'World trade is at a crossroads given the protectionist stance taken by some parts of the world.'