Distinguished guests, ladies and gentlemen
Its an absolute pleasure to be here in Singapore again. We enjoy an excellent relationship with Subhas and the AAPA and of course all our member airlines who are also members of AAPA. There is a very healthy overlap between IATA and AAPA membership.
Meetings like this in Singapore are very important because we need an independent voice from Asia on matters related to aviation. All too often we only see the Americans, Canadians and Europeans driving the global agenda on aviation – this is not to criticize those states, after all, we need someone to propose agendas to drive our industry forward – but we do need to hear a strong voice from Asia as well.
And Asia Pacific is uniquely placed because of the diversity of the region and the balance between highly developed countries and developing countries - Asia Pacific has all the flavours.
Thank you for this opportunity to speak to you today.
We are here today in Singapore, always one of the most forward-thinking aviation nations.
What AAPA, IATA and our Asia Pacific members and their governments share is the belief that travel is an essential prerequisite for greater understanding, greater personal fulfilment, and greater economic prosperity and innovation. We all saw the terrible impact that ensued when that desire, that necessity, to travel was stopped by the COVID pandemic.
The cost of restrictions on travel - to trade, to growth, to human contact, was incalculable. The value people attach to their right to travel has been proven by the tremendous bounce-back in demand since restrictions were lifted.
We are proud to be “contributing architects”, if you like, to a modern interconnected world; yesterday we were in Hong Kong, USA, Switzerland, Kazakhstan, Jakarta, Delhi, Kuala Lumpur. Today we are all here in Singapore.
In September, Asia-Pacific airlines enjoyed a 92% increase in international traffic compared to September 2022. Domestic markets are also looking strong. Chinese domestic demand was up a remarkable 168% on a year ago and India and Japan enjoyed double-digit growth. The overall Asia-Pacific market is still 10% down on pre-pandemic levels, but the trend is very encouraging. The challenge remains: how to be sustainably profitable against tough market conditions: high oil prices, high airport charges, reduced capacity due to engine and spares problems. I salute AAPA’s members as you wrestle and find solutions to these problems.
Despite the good news of the continuing recovery, particularly in China in our part of the world, and the rise of the Indian Middle Class, there are concerns on the horizon over the impact of economic slowdown, and political instability and wars. This is a troubling time for all of us and I’m sure, like me, you hope for a more peaceful and prosperous world. In the meantime, it is our duty to highlight the key challenges that we must resolve if we are to strengthen our resilience and sustainability, with a focus on the needs of the Asia Pacific region.
Today I’d like to talk briefly about airport and ATM infrastructure, and the environment and sustainability.
Infrastructure
Airports need to share and discuss their growth and capacity issues with their users. There’s been a significant increase in congestion in Manila, Ho Chi Minh City, Jakarta, Auckland and at major airports in India. Why don’t we have Airport Consultative Committees in these airports?
Lets not see Asia Pacific airports, regulators, governments follow the Schiphol example on slots.
The current Dutch caretaker government is determined to reduce Schiphol capacity from 500,000 slots per year to 440,000 – to reduce noise. ICAO’s Balanced Approach to Aircraft Noise Management is the global standard to manage noise, and it should be fully applied. It recognizes that governments have a right to take measures to reduce noise at airports. But it requires that capacity constraints, as the Dutch government is implementing, are the last resort—not the first measure.
KLM is one of the worlds most successful hub operators, what does the Dutch Government have in mind when it reduces the slots available to operate at Schiphol by 11%?
Our ask is that local discussion on noise and other matters is important. So please could we see more Coordination Committees at Level 3 airports across the region, in line with the recommendation of the WASG.
On air traffic management, we remain concerned that the infrastructure development in the region is failing to keep up with the pace of demand. States consistently fail to consult with airspace users about the industry’s needs and continue to think and plan within their own borders only, rather than adopting a systemwide or regional viewpoint. With the notable exception of States such as Singapore and Japan, innovation is generally absent in ATM planning and procurement.
Innovative and region-wide cost-effective ATM solutions are necessary to manage today’s traffic levels, and critical to safely and efficiently accommodating the forecast traffic growth and meeting our 2050 goals.
Sustainability
Sustainability is our biggest challenge. The region will need to move rapidly towards the use of Sustainable Aviation Fuels (SAF), as it will play the largest role towards reaching our goal of net-zero CO2 by 2050.
IATA has been actively providing support to airlines in the region to help them get ready for the transition to SAF. But ramping up the use of SAF goes far beyond the efforts of airlines alone. It requires close cooperation among different industry sectors, from agencies overseeing energy production and transition, fuel producers and suppliers, to the airlines.
Most importantly, governments in the region must take the lead by introducing policies that will ensure sufficient SAF supply and to enable the uptake by airlines. Many countries are just starting to consider SAF production and adoption, so government support - for example in the form of incentives - will be crucial to reduce risk and accelerate the energy transition at this early stage. Governments should set up comprehensive consultation processes that involve all stakeholders to discuss how the industry can transition to SAF. And a transition from consultation to action, in the form of a task force or working group, for example, will be vital.
Collaboration on a global level is also key, as the net-zero target is a collective goal for all states and airlines. This is why the on-going work at the ICAO platform, such as the ICAO Conference on Aviation and Alternative Fuels, or CAAF/3, is so important to drive the global effort.
We look forward to a positive outcome at CAAF/3 which will guide and facilitate the industry’s efforts on SAF in the years to come.
Conclusion
This region is extremely close to my heart in more ways than one. I hugely admire the energy and success of the people of this region. Your airlines are a reflection and an extension of that success. You serve your customers and your economies, linking people and nations together. In times like these, that mission is more important than ever.
This region, Asia Pacific, is at the epicentre of tremendous change. Our industry – our world – is on a transformation journey, the speed of which will make the incredible advances of the past century seem ponderous. It is a profound and exciting time.
Thank you.