Discussions on the future of aviation in Europe took center stage at an Aeropolitical Day in Vienna on 22 May. Austria will take up the Presidency of the European Union in July, which gives it a pivotal role to ensure that urgent industry issues are tackled at a coordinated European level. The Aeropolitical Day, hosted by IATA in association with the European Parliament, the European Commission, and Austrian Airlines, featured panel discussions on three of these urgent issues: smarter regulation (including taxation policies to encourage air connectivity), environmental responsibility, and capacity constraints.
To address these issues effectively, governments should adopt a balanced approach based on smarter regulation principles. These principles include elements such as rigorous cost/benefit analysis and robust user consultation. Therefore, it was very encouraging that in his keynote speech, Austrian Minister for Transport, Innovation and Technology, Nobert Hofer, commented that the Austrian Government is committed to creating the best possible framework for aviation.
On the issue of better taxation policies, Austria has already taken a leadership position. In January, the Government cut its passenger tax by 50%. And Minister Hofer stated that he was committed to do his best to bring the tax to zero in 2020. This is a welcome development for airlines since aviation taxes can negatively impact aviation demand and the broader economy. Countries with high aviation taxes are also less attractive for airlines to expand operations due to their lack of competitiveness.
In terms of environmental challenges, IATA Regional Vice President for Europe Rafael Schvartzman highlighted that the aviation industry recognizes how its operations contribute to climate change and is taking the responsibility to lessen the impact. The industry has committed to goals such as carbon-neutral growth from 2020 and to cutting carbon emissions by 50% by 2050. These goals will be delivered by way of a four-pillar strategy which includes technology, operations, infrastructure and CORSIA (Carbon Offsetting and Reduction Scheme for International Aviation). One of the most important areas European governments can assist the industry in this area is to encourage the production of Sustainable Aviation Fuels (SAF). The Austrian EU Presidency, along with its predecessor Presidencies of Estonia and Bulgaria, adopted a shared policy agenda, of which one stated aim was energy and climate change. At the same time, the Renewable Energy Directive II is being debated in the European Council. Airlines are pushing for REDII to contain appropriate incentives for more SAF production. Austria's support for this policy goal would be further proof of its commitment to facilitating greater air connectivity and sustainability.
Finally, on the issue of capacity, Europe faces a particularly acute challenge. Passenger numbers are set to increase by 50% over the next 20 years. This means that new capacity is not only needed on the ground, but in the air also. In this regard, it is essential that Europe achieve the objectives of the Single European Sky (SES). Schvartzman took the opportunity at the Aeropolitical Day to remind delegates that delivery of the SES is the responsibility of each Member State and should be in the political agenda of each Transport Minster. IATA is supporting the SES and the European Commission by championing a new strategy which involves engaging directly with identified states and air navigation service providers in Europe to modernize and reform ATM, through developing National Airspace Strategies which complement the top-down SES plan. So far, campaigns have kicked off in France, Spain, Italy, Poland and Bulgaria.
From left to Right: Raimonds Gruntins IATA Regional Affairs Director, Christian Helmenstein Chief Economist, Federation of Austrian Industries, Vincent De Vroey Civil Aviation Director, AeroSpace & Defence Industries Association of Europe, Harry Hohmeister, Member of the Executive Board, Lufthansa Group, and Rafael Schvartzman, IATA Regional Vice President Europe