The Economic Benefits of Improvements to Middle East Air Traffic Control
The Middle East’s aviation industry supports two million jobs and US$116 billion in GDP for the region. Dubai is currently the world’s busiest international airport in terms of passenger numbers and the region carries a five percent share of global passenger traffic.
Even as fleets across the Middle East are forecast to grow at an annual rate of more than 10% over the next decade, the airspace is already becoming increasingly congested. Making the most of opportunities that growth offers, means something must be done now to address the airspace challenge.
An Oxford Economics report commissioned by NATS in 2015 found that in the Middle East, the average tactical delay per flight attributed to ATC is 29 minutes. Based on a conservative forecast, average delays are expected to double to 59 minutes per flight by 2025. Using 2015 as a baseline, without action to further enhance the efficiency of ATM operations, ATC net delay costs in the Middle East from 2015 to 2025 could be enormous – US$7.22 billion in ATC delay cost to passengers; US$9.12 billion in ATC delay cost to airlines.
The good news – enhanced ATC systems would help deliver an estimated US$16.3 billion in economic benefits over the next ten years, 44% to the benefit of passengers through faster travel times, the rest delivered to airlines through reduced fuel and operational costs. In theory, this could be passed on to passengers through lower ticket prices and potentially generating increased demand.
For Qatar and Oman, Oxford Economics concluded that improvements in their air traffic services would benefit their economies by over US$1.5 billion and nearly US$600 million, respectively.
The report highlights a clear economic case for much greater institutional, operational and technological investment in air traffic control systems across the region.
While the investments made by governments and the aviation industry to increase trade and tourism are recognised, Oxford Economics notes ‘the pace of progress often does not meet the pace of continued traffic growth’.
The challenges highlighted by the Oxford Economics report for the Middle East also have resonance across the Asia Pacific region where economic growth and the aviation industry that helps drive it, can be held back if the right infrastructure isn’t in place. Collaboration between civil aviation authorities and the private sector will go a long way in closing that gap.
It is critical, that airspace, the ‘invisible infrastructure’, is not forgotten.