IATA chief outlines development hurdles for China aviation industry

IATA chief outlines development hurdles for China aviation industry China must overcome five key hurdles to meet air transport needs and become a 'cost-efficient, safe and competitive industry' in coming years, said Giovanni Bisignani, International Air Transport Association chief executive officer, in Beijing on Thursday.
   'China has an important role in the industry today, and is a future global leader for air transport,' Bisignani said at the China Civil Aviation Development Forum. 'By 2010, the largest single market for aviation will be intra-Asia, accounting for nearly a third of all air travel, with China at the center. China is at a critical moment that is also a great opportunity. And to build a more successful future, China has to avoid the mistakes made in other parts of the world.'
   The five key areas of development are:
      * Efficient air traffic management. 'The goal is to use global standards to make Chinese airspace among the most effective in the world to meet demand safely and efficiently,' Bisignani said. 'While there have been impressive accomplishments in China — IATA-1 was opened last year that cuts 30 minutes off a round trip to Europe — big challenges still remain. The congestion delays in the Golden Triangle can be measured in hours, while the inefficient airspace design in the Pearl River Delta is costing HK$1 million a day with Chinese carriers being the most affected. We need a solution quickly.'
      * Environmental sustainability. 'Climate change is among the biggest issues facing aviation today,' he said. 'Airlines, like all industries, must do more to limit their carbon footprint. China needs to ensure that aviation is treated fairly when incorporating environmental targets in development plans. He also urged China to join the IATA environment agenda to use technology to further improve the fuel efficiency of aircraft, make air traffic management as efficient as possible, avoid taxes and charges, and adopt global solutions for emissions trading.
      * Cost-efficient airport infrastructure. 'China has some of the highest charges in Asia outside of Japan,' Bisignani said. 'With uniform charges for all Chinese airports, they are definitely not cost-related. IATA is working with the government to develop a charges regime that challenges airports on efficiency, provides a reasonable return to investors, and supports a competitive industry.'
      * Internal cost control. 'It is easy to overlook productivity issues when experiencing high growth and everything is absorbed in the bottom line,' he said. 'Chinese carriers should focus on productivity now and not wait for a crisis to do so, as shown in the experience of the U.S. and European carriers. Effective cost allocation is the only way to understand where the gaps are, and identify areas for improvement.'
      * Commercial freedoms. 'The recent U.S.-EU open skies agreement moves the industry in the right direction, but falls short of the fundamental change we need,' he said. 'China's fast growing economy demands efficient air transport links, and progressive liberalization has played an important role — opening Hainan as a free port for aviation services, liberalizing bilaterals with the U.S., ASEAN, Japan and Korea. With the aviation industry's center of gravity moving East, China has an enormous leadership opportunity to shape policy where the U.S. and EU have failed to do so.'