Only a few days ago, on 19 April, IATA celebrated its 70th Anniversary. IATA was founded by a group of visionary airlines with a very clear purpose:

  • To promote safe, regular and economical air transport for the benefit of the peoples of the world
  • To provide a means for collaboration among the industry’s stakeholders
  • And to represent the industry in critical cooperation with the International Civil Aviation Organization (ICAO) and other international bodies

Safety is the industry’s top priority and has been at the core of IATA’s activities since the very beginning. So it is with great pleasure that I join this important forum today. Thank you to CATA for hosting this event and for our continuing cooperation in serving the air transport industry.

And I should begin by congratulating the Chinese industry for an exemplary safety record. Air transport links continue to play a vital role in China’s development. The combined efforts of the government, airlines, airports, those who manage air traffic, those who service aircraft on the ground and many others have built a first class safety record for China.

The numbers are very impressive. In the mainland of China there have been no jet hull losses since August 2010.

IATA has a strong presence in China with our regional office under the leadership of our Regional Vice President Zhang Baojian and our Regional Director for Safety and Flight Operations Li Wenxin. Our team is in constant collaboration with all the stakeholders in Chinese aviation—including our 21 members in Greater China —to support the successful development of aviation.

The Global Picture

Looking at the global picture, without a doubt the past 13 months have been an extraordinarily difficult time for aviation safety. In 2014 there were 12 fatal accidents. And we have had two fatal accidents already in 2015. I know that you will join me in remembering all those who grieve for the victims of air disasters.

Each and every accident is a tragedy. Each re-dedicates us to learning lessons and improving further.

Flying is safe. In 2014 approximately 38 million flights reached their destinations safely. Last year, the global jet accident rate measured in hull losses per one million flights was 0.23, the equivalent of one major accident for every 4.4 million flights. This was the lowest rate in history and a 60% reduction compared to the five-year rate of one major accident for every 1.7 million flights.

That positive record and improving safety trend has been overshadowed by a sequence of extraordinary disasters. Three in particular have grabbed the global attention of the media and regulators.

  • Aircraft such as MH370 operating under radar control are not supposed to disappear
  • Aircraft such as MH17, operating in open civilian airspace are not supposed to be shot down by missiles
  • And aircraft under the control of pilots trained with safety as their first priority are not supposed to be piloted into mountains as happened with Germanwings last month.

Industry and governments came together quickly to learn from these. ICAO is moving towards the adoption of a performance-based standard for global tracking of commercial aircraft, supported by multi-national operational assessments to evaluate impact and guide implementation. ICAO has also launched a website where critical security information can be exchanged. We have joined forces in pursuing a global treaty to regulate the design, manufacture and deployment of weapons with anti-aircraft capability. And literally within hours of the cause of the Germanwings crash becoming known airlines and governments began reviewing policies and procedures.

Further Improving Safety

This continues the tradition of learning from accidents to make flying safer. But, with so few accidents we cannot rely on their investigation alone to guide our efforts. Alone they cannot yield the trend data that is vital to a systemic risk-based approach to improving safety.

Future safety gains will come increasingly from analyzing data from all flights, not just the infinitesimal percentage of flights where something goes wrong. That is what is behind IATA’s Global Aviation Data Management (GADM) program, a comprehensive safety data warehouse. GADM includes analysis reports covering accidents, incidents, ground damage, maintenance and audits, plus data from nearly 2 million flights and over 1 million air safety reports.

Data also tells us that auditing against global standards improves safety. The IATA Operational Safety Audit (IOSA) is such a standard. The accident rate for IOSA-registered airlines was three times better than that for non-IOSA registered airlines last year. This year we transition to Enhanced IOSA, which introduces continuous monitoring systems to monitor compliance across the two-year audit cycle. This is moving IOSA from a once-every-two-year snapshot to a continuous management process.

IOSA is a requirement for membership in IATA. And in Greater China we have 25 airlines on the IOSA registry, even more than our 21 members.

But there are hundreds of operators which are not eligible for an IOSA audit—including several of CATA’s domestic airline members. The threshold for IOSA is aircraft with maximum take-off weight above 5,700kg. And there are also some charter or contract flying business models which do not quality for IOSA. For these, last week we launched the IATA Standard Safety Assessment (ISSA). ISSA is not a substitute for IOSA. But its creation gives us an opportunity to spread global best practices in safety across a broader range of airlines.

We look forward to working with CATA and the authorities to encourage the adoption of ISSA in China. As I mentioned, the safety record of Chinese airlines is exemplary. And ensuring that China’s smaller airlines are operating to global best practices can only help to reinforce China’s strong performance.

Dangerous Goods

Speaking of China’s safety performance, I have one major concern that I wanted to share with you. That concerns the carriage of dangerous goods, in particular lithium batteries.

As an industry we have a long tradition of managing the risks of dangerous goods to ensure their safe carriage. At the government level, the ICAO Dangerous Goods Panel does excellent work keeping ahead of potential threats and challenges. And the IATA Dangerous Goods Regulations help the industry—the entire value chain including airlines, shippers, agents, handlers and others—to put that expertise into daily practice. The result is that the industry handles these items safety.

Importantly, this framework is responsive to both new risks and new information or technology that can promote constant improvement. But regulations can only deliver value if they are understood and followed.

The rise of e-commerce and the ability of small businesses to export to a global customer base has created fantastic business opportunities and expanded the number of shippers. It is a challenge for the industry to ensure that these new shippers are up-to-speed with the rules on shipping dangerous goods.

In addition to the proliferation of shippers, one item gives us particular concern—lithium batteries. And, as China is a major production center for lithium batteries, ensuring the safe carriage of this cargo is a major concern for the Chinese air transport industry. Because of the complex supply chains involved, it is crucial that all the stakeholders are aligned.

To support the growth of awareness and knowledge-sharing on this issue in China, IATA has released the new Lithium Battery Shipping Guidelines in Chinese. This document is designed to guide shippers and manufacturers step by step through the shipping process. With these guidelines and other awareness work by the Universal Postal Union and ICAO, the industry is making real progress in bringing stakeholders on board.

Safety is a shared responsibility. The industry is doing its utmost to promote the following of best practices. And the role of the regulator is to ensure compliance. Oversight, surveillance and enforcement are the responsibility of regulators. Unless they are used effectively compliance at source will be limited.

Disappointingly, we are seeing some willful non-compliance in the area of lithium batteries—particularly here in China. For example, there is a supplier on Ali Baba claiming they will re-label 300 Watt hour batteries as 100 Watt hour, and even ship them via the standard postal service. We are pressing regulators and the e-commerce sites to be more diligent in making sellers aware of regulations and, as importantly, taking action to address non-compliance.

It would be a shame if China’s exemplary safety record were compromised because of such negligence.

Airspace Capacity

Another concern that I have is the optimization of airspace capacity in China—a topic which I am pleased to hear will be discussed in this forum.

Nearly 70,000 flights a week operate to, from or within the mainland of China. That’s about 10% of the global total. China should be congratulated for managing such a large number. It is a major accomplishment, especially given the complex mix of civil and military concerns involved as well as the phenomenal rate of growth.

While there is no question that these are being handled with safety as a top priority, it is also no secret that delays are a major issue. For airlines operating hub and spoke systems the enormous costs of delays are a major concern. For passengers they are a major frustration. And for the economy they are a drain on productivity due to wasted time, missed meetings and trips foregone.

Finding ways to improve performance has been high on the list of priorities for airlines, IATA and the Chinese authorities. And we truly appreciate the CAAC’s efforts to implement the State Safety Plan, upgrade systems, open new routes, develop new airports, reduce delays and much more.

It is clear that China is fully dedicated to supporting its overall development with a strong air transport industry. Building on these initiatives I would like to take this opportunity to highlight five priority areas where further improvements can be pursued.

1. More efficient use of existing capacity. China maintains two routes systems—one for domestic and one for international. If domestic routes could be opened to international traffic some major gains could be achieved. In many cases the domestic routings offer more direct flight paths. And because peak times for domestic traffic differ from those for international traffic we could achieve an overall increase in capacity with no detrimental effect to domestic operations. The ideal situation would be one in which such distinctions were fully eliminated or at least having all current domestic routes open for international operations.
2. The second area is process flexibility. Airlines fly most efficiently when they can make best use of meteorological conditions such as wind. China maintains a rather rigid system with restrictions on entry/exit points to Chinese airspace; and complex and time-consuming procedures for re-routing requests. If we can simplify these procedures and reduce the restrictions on entry/exit points we could achieve significant performance improvements. On entry points, for example, China has 34 of which 9 are designated for flexible use. We are working with the CAAC in a request for 12 more to have similar designation.
3. The third area for potential improvement is predictability. That can be achieved with the introduction of an air traffic flow management system. And if that is accompanied by a system-wide (international and domestic) collaborative decision-making process further gains are possible.
4. Fourthly, although there has been significant improvement in the cooperation between civilian and military authorities in recent years, there is still some unrealized potential. In particular, more advance notice and alternative routings when military exercises necessitate route closures would help airlines to manage the situation more effectively for their passengers.
5. And finally, there is more potential to be gained in interoperability from the significant investments made to introduce performance based navigation (PBN) in China. Safety enhancements have certainly been realized as a result of the progressive introduction of PBN to more airports and routes. But the potential for PBN to allow for route-restructuring and achieve more direct routes has not yet materialized.

I emphasize that much progress has been made to improve the efficiency of China’s air traffic management. And I appreciate the tremendous challenge just to keep pace with annual growth of 8% or greater. The impressive achievements to date give us confidence that even more improvements are possible.


My final message for today is that IATA is here as a partner. As I mentioned earlier we have a strong team based here in China who are engaged with the CAAC, the ATMB, the military and the industry. And they draw on the global expertise and view that IATA has accumulated over its 70 year history.

Thank you.