Aviations Role in Economic Recovery

The International Air Transport Association (IATA) called on the new Obama Administration in the US to prioritise 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, said Giovanni Bisignani,
In a speech to the Wings Club in New York, Bisignani urged the Obama Administration to go beyond the airport investments in the White House Agenda. 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 US$4 billion 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, said Bisignani. IATA also urged the Obama Administration to deliver broad policy changes in the areas of security, environment and commercial freedoms: Security: Security improvements since September 11, 2001 have come with a growing bill that now totals US$5.9 billion annually. Bisignani challenged governments on efficiency. I am not convinced that we are much wiser or any more efficient in our processes, said Bisignani. 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 recognising each others 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: Bisignani praised the Obama Administrations intention to be a leader in addressing climate change and urged the President to support aviations global efforts to contain and reduce the 2% of man-made carbon emissions attributed to aviation. The aviation industry is united behind IATAs Four Pillar Strategy of technology investment, efficient infrastructure, effective operations and positive economic measures. The strategy is delivering results. Since 2004, some 59 million tonnes of CO2 have been saved and this year, aviations carbon footprint will shrink by 4.5% - 2.5% from capacity reductions and 2% due to efficiency gains. We need government leadership with a global vision. Governments must stimulate the economy with green investments such as biofuel research and tax breaks for new aircraft purchases. And they must remain true to the vision of Kyoto which entrusted the International Civil Aviation Organization (ICAO) to deal with aviations international emissions. In preparation for Decembers Climate Change Conference in Copenhagen, the ICAO Group on International Aviation and Climate Change (GIACC) will produce an action plan in September. We need the US, a member of GIACC to be a strong voice opposing Europes unilateral, illegal and ineffective regional emissions trading plans while building consensus for a global solution, said Bisignani. 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. Why does the US restrict ownership of its airlines to 25%, effectively limiting the ability of international capital to offer Americans aviation jobs? Passengers dont care who owns an airline, so long as it is safe and provides efficient service. Governments should take the same view. Following IATAs Agenda for Freedom Summit last October, we are working with 14 governments and the European Commission on a Multilateral Statement of Policy Principles. I hope that early in President Obamas 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, said Bisignani. The priority of government is to create jobs and restore the economy to health. In the US, aviation supports 10.2 million jobs and US$1.1 trillion in economic activity. Meaningful change in governments approach to security, the environment and commercial freedoms will ensure that aviation plays its role as an economic catalyst, said Bisignani. View Giovanni Bisignani's full speech


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