IATA in the Americas
IATA's regional office for the Americas, based in Miami, along with its 10 country offices support the organization’s mission to represent, lead and serve the airline industry. We seek to improve the understanding of the aviation industry and increase awareness of the benefits the industry brings to regional and local economies.
We champion the global and regional interests of our members, challenging unreasonable rules and charges, holding regulators and governments accountable.
IATA promotes the value aviation brings by increasing connectivity, improving infrastructure, helping airlines in the region become more competitive by advocating for a smarter regulatory environment and improving the passenger experience through the use of technology.
The regional office maintains close relations with governments, their agencies, the International Civil Aviation Organization (ICAO), the Federal Aviation Administration (FAA), Latin American Civil Aviation Commission (LACAC) , Latin American and Caribbean Air Transport Association (ALTA), Airlines for America (A4A), airports, air navigation service providers and regional airline associations.
IATA 5 year strategic plan for the Americas
The IATA Americas team has developed
a five year strategic plan (pdf) with input from key stakeholders across the region to tackle the largest opportunities and threats, creating common objectives and initiatives to focus on between 2016 and 2021.
The Region at a glance
- 840,000 jobs generated by the airlines industry in Latin America and the Caribbean
- 4.2M people employed by industries supported by Aviation
- 268M passengers transported in 2014
- $138 billion aviation contribution to the region's GDP
- 5.4% annual growth of Revenue Passenger Kilometers (RPKs) forecast over the next 20 years
2016 Economic Outlook for the Americas
Regional outlook is mixed
Commodity price and exchange rate shocks hit the region hard in 2015
Mexico and Colombia forecast to fare well in 2016; Mexico is benefiting from strong US economy
Brazil is in recession and the next couple of years will be challenging
Argentina’s troubles include high inflation and a worsening fiscal situation. Likely to get worse before it gets better
Americas Focus IATA's Latest Regional Activities
The third quarter of 2016 has been a transition period for IATA and for our industry. We welcomed our new Director General & CEO Alexandre de Juniac aboard and we said our farewells to Tony Tyler. Alexandre will visit our region for the first time in his new role during the upcoming ALTA Airline Leaders Forum in Mexico City on November 15 and I know he is looking forward to meeting many of you in person.
I am also pleased to share that Mark Rodrigues, a dedicated airport subject matter expert, joined the IATA team as airport infrastructure remains one of the key challenges we face in the region. As a follow up to IATA's Aviation Day in Argentina, I met with Transport Minister Dietrich on October 20 and he continues to support our initiatives on all fronts, specifically related to creating collaborative groups to discuss infrastructure plans, taxes and charges and ensure industry alignment.
As usual, I hope you will find the below updates on our 3rd quarter key activities of 2016 useful and please do not hesitate to contact me for more information. We are here to serve you.
Peter Cerdá, IATA’s Regional Vice President, The Americas
Airlines Hail Historic ICAO Carbon Agreement
Following six years of negotiations, governments meeting at the 39th ICAO (International Civil Aviation Organization) Assembly have reached a
historic agreement on the design elements of a global market-based measure for international aviation. It is part of a series of actions the aviation industry is taking to reduce its carbon emissions which includes investing in new technology, scaling up the use of sustainable alternative fuels, improving operational performance of aircraft in the fleet and using more efficient infrastructure.
The carbon offsetting and reduction scheme for international aviation (CORSIA) will be the world's first market mechanism for dealing with climate change from any industrial sector. In addition, 65 States have already volunteered to join the carbon offsetting and reduction scheme for international aviation (CORSIA) from its outset in 2021, meaning over 80% of the total growth in aviation CO2 after 2020 will be covered.
Looking forward, IATA will pursue to sign a Memorandum of Understanding with EANA (Air Navigation Service Provider) to partner together in improving the air space in Argentina which is currently facing significant efficiency challenges resulting in departure and arrival delays.
Brazil: Tax Authority No Longer Intends to Declare Ireland as Tax Haven
Brazil's tax authority intended to list Ireland as a tax haven, which would have meant about 1 billion reais ($306 million) in new taxes on aircraft leases for Brazilian carriers struggling to regain profitability. According to ABEAR, 60 percent of the 520 aircraft flying commercially in Brazil are leased from companies registered in Ireland, where they enjoy favorable tax rules. Brazil's tax authority announced on Sep 15 that it was adding Ireland, Austria, Curaçao and Saint Martin to its list of countries denominated as tax havens.
However, IATA and ABEAR protested the surprise tax decision taken without consulting the airline industry by contacting stakeholders and reaching out to media outlets. As a result, Brazil's tax authority reversed their decision.
Canada: NAVCANADA Reduction in Charges
IATA successfully collaborated with NAVCANADA to reduce their ATS charges in Canada. NAV CANADA will decrease charges by 7.6% on average, with savings of approximately $100 million from September 1, 2016 to August 31, 2017 (fiscal 2017).
Central America: PAConf Approved BSP Remittance Day Calendar Changes
The passenger agency conference (PAConf) approved the proposal of reducing the credit time from 10 to 5 days for Central American travel agents to remit funds to BSP. This will improve airline cash flow by 5 days for Central America BSP sales, which amount to $855 million. This change will be effective on January 1, 2017.
Chile: Letter To Minister Regarding Airport Fees
IATA sent a letter to Chile's Minister of Public Works (MOP) expressing its concerns on the increase in airport charges at Arturo Merino Benitez Airport in Santiago. Immediately after taking over the airport concessions, Nuevo Pudahuel set the charges to the maximum amount allowed under the bidding rules, despite the fact that the level of service will not change until the new terminal is ready in 2020.
IATA asked the Chilean State not to alter the rates under its control as the increase in boarding fees and taxes on passengers will negatively effect passenger volumes and the economic sustainability of the airport. IATA reached out to Chilean authorities, airlines and Nuevo Pudahuel about the tariff hikes and proposed to work together to establish an appropriate service level. IATA also offered its subject matter experts to join a working group to establish a sustainable strategy for the future growth of SCL.
Colombia: Announcement of New BOG Airport and FRMS Developments
Colombia's government announced plans to construct a second airport in Bogotá in the next five years, known as El Dorado II. IATA immediately contacted the government and expressed its concerns to building a new airport as the focus should be on improving the current BOG. However, if the project moves forward, IATA stressed the importance of having airlines involved from the beginning as constructing a new airport with no industry input could affect Bogota's strategic position as a regional hub.
Separately, IATA continues to support ATAC with the technical expertise to educate the Colombian Congress and other government officials on FRMS. If the law is passed it would have a significant impact on Colombian airlines, resulting in job losses and reduction of flights.
Colombia: Update on BOG ATM Project
Following the project timeline, final CONOPS was presented in August and positive feedback was received from the UAEAC. Final charts and coding have also been presented and are awaiting final approval for their publication in October.
Further milestones: 1) New ATC operations manual under review and awaiting approval by UAEAC. 2) FHA and PSSA to be delivered in October. 3) Ground operations assessment and recommendations to be delivered in mid-November. 4) Operational safety assessment final document to be delivered to UAEAC in December. 3NM separation analysis for current ATM system (performance/availability) was already delivered and documented proving the information required to update the regulation.
Cuba: OFAC License Granted
IATA received the amendment to IATA's OFAC license under the U.S. Cuban Assents Control Regulations. Following President Obama's decision to relax U.S. sanctions against Cuba, and immediately after the U.S. and Cuba signed a new MOU on air services between the two countries, IATA formally applied for an amendment to that license permitting IATA to engage in its normal suite of aviation-related activities without limitation. The letter received from OFAC grants the amendment fully in keeping with IATA's request.
Immediate opportunities are establishing of full service Cuba BSP and CASS in the Miami office and provide strategic, tactical and commercial support to the growing Cuban air transport sector.
El Salvador: Consumer Protection Agency Contract Review
The Consumer Protection Agency (CPA) of El Salvador has reviewed the passenger contracts of airlines operating in the country and has declared most of their clauses as "abusive". To clarify this situation, IATA submitted a letter to President of the Board of the CPA in order to explain that the terms, conditions, and consumer rights in air transport contracts are governed by international conventions.
A meeting has been confirmed to take place with the President of the CPA on November 3 to explain this matter in more detail and share technical insights.
Guatemala: Letter to President Regarding Tax Increase on Jet Fuel
The Guatemalan government introduced a fiscal reform before its Congress which includes an increase to the tax on jet fuel to 30% of the product's market price. This increase is not expected to affect carriers from countries that are exempt from fuel taxes due to bilateral agreements. However, it does have an effect on several of IATA's members whose bilateral agreements do not enjoy this exemption.
To avoid the abrupt increase of this tax, IATA submitted a letter to the President of Guatemala addressing the negative impact of the increase and requesting its revoking. This initiative was withdrawn from Congress in order to have further discussions on its impact. As a result of IATA's action, a meeting with the Minister of Energy and Mines has been confirmed for November 30.
Paraguay: Industry Day Summary
IATA participated in an Air Transport Industry Day in Paraguay, organized by Paraguay's CAA and DINAC, attracting over 100 representatives from the government, airlines, industry stakeholders, and private and public organizations. Multiple workshops were facilitated by IATA and ALTA to exchange information with stakeholders on some of the key matters across the region, including Smarter Regulation, Passenger Data, Consumer Protection, and Airport Concessions.
Continued emphasis was put on the need to keep an open communication channel between industry stakeholders, especially between authorities and airlines, and have a collaborative approach for every initiative to work towards a safer and more efficient air transportation industry in Paraguay.
Trinidad & Tobago: Repatriation of Funds
Trinidad & Tobago is suffering economically from a sharp decline in energy prices as liquid natural gas, Trinidad's main export, have declined by approximately 45%, undermining the country's dominance of the regional market. As a result, Trinidad & Tobago's foreign exchange reserves have declined, reducing the available supply of USD and significantly delaying the repatriation of funds to airlines operating in the country to the amount of $2.8 million. IATA continues to work with the Government of Trinidad & Tobago towards a swift solution to clear the backlog.
Venezuela: DOT Filing for Antitrust Immunity
IATA filed a request for antitrust immunity with the U.S. Department of Transportation to allow airlines to discuss options to maintain connectivity to Venezuela in light of the Venezuelan government's continuing refusal to release US$3.8 billion in airline funds. A
press release was issued simultaneously. The country's economic and political situation continues to worsen after Congress voted to open a political trial against President Maduro for breaking the constitutional order and opposition leaders called for mass protests to drive the unpopular socialist leader from office. The vote by the opposition-led legislature is unlikely to have any legal effect as President Maduro continues to control other branches of government, including the military and the Supreme Court.
State of the Region Economic Report: The Americas
The region's carriers have been relatively restrained in bringing capacity to the market over the past year. NthAm carriers have increased both pax & freight capacity by a moderate 3.7%yoy. Lat.Am capacity growth is even more subdued, up just 1.7% for ASKs & down 0.2% for AFTKs. The respective industry growth rates are 5.8% & 4.1%, respectively.
Load factor outcomes are mixed. For pax, loads exceed 80% for both NthAm & Lat.Am, straddling the industry-wide 83.8% in Aug. For freight, the loads for the region's carriers (31-33%) sit well below the industry-wide 40.8%. The latest Q2 EBIT margin data show continued strong performance from the NthAm carriers, at 15.4% & largely unchanged from a year ago. The Lat.Am margin is up slightly on a year ago but remains marginal at 0.9%. The overall industry-wide margin is slightly below 11%. Access complete
State of the Americas Economic report.
Upcoming Events: Aviation Day Brazil
The final Aviation Day of 2016 will take place in Brasilia on December 1, focused on Brazil's challenges and opportunities. The event is organized in collaboration with ALTA and ABEAR and registration, agenda and sponsorship opportunities are available on the
Aviation Day Brazil website.