NAN-H-24
IATA
By Adekunle Williams /Solomon Asowata
Lagos, Jan. 11, 2017 (NAN) The International Air Transport Association (IATA) on Wednesday predicted that the aviation industry would deliver strong results in 2017, with return on invested capital exceeding cost of capital.
Mr Alexandre de Juniac, Director-General, IATA, made the prediction in a statement obtained by the News Agency of Nigeria (NAN) in Lagos.
He, however, expressed concern over the threat of terrorism and other factors that could negatively affect the growth of the industry globally.
“In 2017, for a third consecutive year, the industry’s return on invested capital will exceed the cost of capital.
“Travel has never been more accessible – with great fares, many options and more destinations.
“Nevertheless uncertainty lies ahead. The threat of terrorism, questions over the durability of the economic upswing, rising oil prices and increasing protectionist rhetoric are among the concerns,’’ the director-general said.
According to him, aviation industry has reshaped itself and strengthened its resilience to shocks.
“We should see another solid year of collective profitability for the airlines in 2017, but we must be vigilant,” he said.
He said that global passenger traffic results for November, 2016 showed strongest demand growth in nine months.
The AITA boss said that total Revenue Passenger Kilometers (RPKs) rose to 7.6 per cent compared to that of November, 2015, while capacity increased by 6.5 per cent and load factor rose from 0.8 percentage points to 78.9 per cent.
“Stronger demand for air travel reflects, and is supporting, a pick-up in the global economic cycle.
“As the stimulus effect of lower oil prices recedes in the rear view mirror, the strength of the economic cycle will play a key role in the pace of demand growth in 2017,” he added.
The IATA boss said that African airlines experienced an 8.2 per cent rise in demand compared to that of November, 2015.
He said: “Economic conditions in much of Africa remain challenging, particularly in the biggest economies of Nigeria and South Africa.
“But the upward trend in seasonally-adjusted passenger traffic has reasserted itself more recently, supported by strong demand on routes to and from Asia and the Middle East.” (NAN)
WAC/ASO/ENN/IGO
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(Edited by Edwin Nwachukwu/Ijeoma Popoola)