Regional open-skies deal will benefit many

06 June 2008
The discomfort of a few airlines should not be allowed to hinder the benefits of an open-skies accord.

Middle East airline executives were among the few to voice any positive opinions at the annual meeting of the International Air Transport Association (IATA) in Istanbul in early June.

Soaring fuel prices have prompted a global crisis in aviation. But while delegates from Europe and North America openly discussed how many of them would still be in business this time next year, officials from the Middle East remained unruffled.

Gulf airlines in particular are able to stave off the crisis because the current oil boom has created far higher levels of disposable income around the region. As a result, people are taking to the skies in record numbers.

All the more reason, then, to take advantage of the increasing demand by deregulating the industry to let it grow even faster.

The Arab Air Carriers Association is pushing for an open skies deal covering the whole region, which will allow airlines to fly wherever they want, within five years. The timeframe seems optimistic, but governments and regulators must force the pace.

If they do, it will increase capacity across the region’s airspace, open up competition and drive down prices. The benefits to consumers, and by extension to national economies, would be immense.

There will be some losers. Although the region has several strong carriers, others will struggle to cope with open competition, particularly those national airlines that have been propped up by their governments and have been slow to modernise. The likes of EgyptAir and Syrian Air will struggle in an open market.

Regional aviation is enjoying record growth despite unprecedented fuel prices. The discomfort of a few airlines should not be allowed to hinder the economic benefits that an even stronger industry would offer to the region as a whole.

News: Airlines call for regional 'open skies' agreement

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