IATA Promotes Aviation’s Role In Economic Recovery

by Mike Godfrey, for LawAndTax-News.com, Washington

24 February 2009

The International Air Transport Association (IATA) has called on the new Obama Administration to prioritize aviation as a catalyst to stimulate the US economy.

“Smart investments - not bailouts - in air transport will pay off with jobs and boost other industries”, commented the IATA’s Director General and CEO, Giovanni Bisignani in a speech made to the Wings Club in New York.

Bisignani urged the Obama Administration to go beyond the airport investments in the White House Agenda, explaining:

“The US air traffic management system is in desperate need of an upgrade. Airlines and airports cannot be efficient economic catalysts if we operate in gridlock. I urge the President to allocate the USD4bn needed to get the ball rolling with the first phase of the long-awaited NextGen project that will create some 77,000 jobs in the US economy.”

The IATA also urged the Obama Administration to deliver broad policy changes in the areas of security, environment and commercial freedoms:

Security:

According to the IATA, security improvements since September 11, 2001 have come with a growing bill that now totals USD5.9bn annually. Bisignani challenged governments on efficiency, remarking:

“I am not convinced that we are much wiser or any more efficient in our processes.”

”We have a great record on safety because data drives decisions that are implemented with global standards. We spend billions on security with little data to support the actions taken. Governments have made minimal progress on recognizing each other’s security standards. We need a system that is threat-based, risk-managed and cost-efficient, with mutual recognition of standards. Security principles must be a part of the corporate structure of all industry players. And governments must be accountable to show value for every dollar that is invested.”

Environment:

Here, Bisignani praised the Obama Administration’s intention to be a leader in addressing climate change and urged the President to support aviation’s global efforts to contain and reduce the 2% of man-made carbon emissions attributed to aviation.

The aviation industry is united behind IATA’s Four Pillar Strategy of technology investment, efficient infrastructure, effective operations and positive economic measures. The strategy is delivering results.

Commercial Freedoms:

“Thirty years after the US started deregulation under President Carter, the job is still incomplete”, said Bisignani in a challenge to reform the 60+ year-old bilateral system.

“International markets remain closed until governments negotiate them open, and foreign ownership restrictions still limit access to global capital and prevent cross-border consolidation. What worked in the 1940s is killing the industry today. To manage through this crisis without bailouts airlines cannot have one hand tied behind their back with outdated restrictions on ownership. I hope that early in President Obama’s term we will be able to change the structure of aviation, not with bailouts, but with commercial freedoms that will generate value for investors and provide a more secure future aviation jobs”, Bisignani continued, concluding:

“The priority of government is to create jobs and restore the economy to health. In the US, aviation supports 10.2 million jobs and USD1.1 trillion in economic activity. Meaningful change in government’s approach to security, the environment and commercial freedoms will ensure that aviation plays its role as an economic catalyst.”

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