Lift in air traffic expected from recovery of emerging markets

Airline passenger traffic is expected to rebound in the second half of next year helped by a recovery in key emerging markets, says a leading industry official.

A stronger Indian economy and more stable situations in Russia and Brazil are expected to give the sector a boost, said Brian Pearce, the chief economist of the International Air Transport Association.

“Air transport normally follows the economic developments and the IMF is pointing to slightly stronger growth in 2016,” said Mr Pearce, on the sidelines of a conference in Abu Dhabi. “Things don’t look bad for aviation at the moment. Although the global economy has been slowing, air travel has continued to grow at a very strong pace.”

This month, the IMF predicted that the world economy would grow at its slowest rate since the financial crisis of 2008.

The fund downgraded its estimates for 2015 global growth to 3.1 per cent from its previous forecast of 3.3 per cent.

Mr Pearce said that the fall in oil revenue was putting pressure on oil-exporting countries, but that did not mean investment in the aviation sector would necessarily suffer.

“It is obvious there are public reserves, but it is up to the governments how they spend those reserves. I think that investment in air transport has clearly very positive long-term economic and social benefits for the region,” he said.

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