• Infrastructure – The Need for Reform

    Ramesh Tiwari
    January 9, 2018
    Infrastructure – The Need for Reform

    By Alexandre de Juniac —–

    We are headed for an infrastructure crisis.

    Many of the world’s airports are operating at or beyond their design capacity. The provision of air navigation services in major markets like the United States, Europe and China is struggling to keep pace with the technical capabilities to manage demand at optimum efficiency.

    And we don’t see governments preparing to make the investments today that will be needed to cope with future growth—especially as major infrastructure planning cycles are now measured in decades.

    There is also a crisis in the cost of infrastructure and Europe, unfortunately, provides the example. Over the last decade, passenger charges on the average one-way ticket have more than doubled—from €16 ($19) to €33 ($39). Over the same period the airfare portion of the average ticket price fell.

    Why these divergent courses? The bluntest explanation rests on pure market forces.

    Airlines are subjected to intense competition. So they are in a constant search for the efficiencies needed to make a more compelling price offering to their customers.

    Airports, on the other hand, are not subjected to the same competitive pressures. With very few exceptions, there is no choice of airports.

    If you want to fly to Amsterdam, for example, Schiphol is your only choice. And when it looks like there might be competition as in Paris, you find that Orly and Charles de Gaulle have the same owner.

    Airports are critical partners for airlines. Without them, airlines would literally have no place to take their passengers.And we are working in partnership with airports to make improvements in key areas such as security, the environment, and the passenger experience.

    But when it comes to charges, the market power of airports is dominant. And that is reflected by European airports, which, despite a light-handed airport charges directive trying to promote efficiency, still managed to double their passengercharges.

    The good news is that the European Union (EU) is set to consider reviewing its airport charges directive. And airlines (the main customer of the airports) are asking, in no uncertain terms, that it be substantially strengthened.

    Strengthened regulation will, in the first instance, protect passengers. Had European charges remained at 2006 levels we estimate that 50 million more people would be flying in Europe today. And that would pay big dividends by creating some 238,000 jobs and adding €50 billion to the continent’s GDP.

    Those are figures that EU regulators should find hard to ignore. Our goal is to find a regulatory regime that fairly balances the interests of airports, passengers, airlines, citizens and the economy.

    If we can achieve that, it will be a hot export commodity. Other regions would have to take note. Because the challenges of high airport charges are in no way limited to what we see in Europe!

    Alexandre de Juniac is CEO of IATA

    Source: IATA

    Jan. 9, 2018

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      News Brief

      Kabul: Afghan security forces have regained control of Intercontinental Hotel, hours after the gunmen burst into the hotel shooting at guests and staff. At least five civilians were killed and six were injured in the siege. Three of the attackers have been killed and more than 150 guests were rescued. No group has said it carried out the attack, but the Taliban targeted the Intercontinental hotel in 2011.

      Beijing: China’s economy grew by 6.9% in 2017 according to official data – the first time in seven years the pace of growth has picked up. The figure beats Beijing’s official annual expansion target of about 6.5%. Gross domestic product (GDP) totaled 82.71 trillion yuan (about 12.84 trillion U.S. dollars) in 2017, with the service sector accounting for more than half of the total.

      Shanghai: China Eastern Airlines and other domestic airlines have begun to allow mobile phone use on their aircraft or announced plans to lift a ban. China Eastern Airlines and Hainan Airlines began to allow passengers to use portable electronic devices (PED), such as smartphones and tablets.China Southern Airlines and Xiamen Airlines announced they would allow mobile phone use on all their flights this week. – Agencies

      2017 in review -Top stories

      January 1 : New year nightclub attack leaves 39 dead in Istanbul
      January 20 : Republican billionaire Donald Trump sworn in as 45th US president
      January 23 : Syria peace talks begin in Kazakh capital Astana
      March 29 :United Kingdom officially launches the Brexit process
      April 4 :Syria launches chemical attack killing 90 people
      April 6 : US cruise missiles destroy Syrian air base
      April 9 : Bombings at two churches in Egypt kill dozens
      April 16 : Refugee death toll passes 1,000 in Mediterranean
      April 16 :Turkey says YES to presidential system
      May 6 :Emmanuel Macron elected French president defeating Marine Le Pen
      May 19 :Iran’s President Hassan Rouhani wins re-election
      May 22 : Terrorist attack kills 22 at Manchester concert
      June 5 : Gulf nations severe ties with Qatar
      June 7 :Suicide bombers attack Iranian parliament killing 13 people
      June 14 :London fire kills 71 in the 24-storey Grenfell Tower
      July 4 :North Korean leader Kim Jong-un’s missile ambitions
      July 28 : Pakistan’s top court disqualifies Prime Minister Nawaz Sharif from office
      August 5 :US withdraws from Paris climate change pact
      August 17 :Storms cause record damage in Caribbean and southern United States
      August 25 :Muslim Rohingya start fleeing Rakhine state in Myanmar
      September 15 : NASA’s 13-year Saturn mission ends
      September 20 : Earthquake kills more than 200 in Mexico
      September 24 : Germany’s Chancellor Angela Merkel wins fourth term
      September 26 : Saudi Arabia lifts ban on women driving
      October 1 : Gunman opens fire on Las Vegas music festival killing 59 people
      October 14 : Massive bombing in Somalia’s capital Modadishu kill more than 500 people
      October 24 : China confirms the elevation of President Xi Jinping to the same status as the nation’s founder, Mao Zedong, and Deng Xiaoping, by enshrining ‘Xi Jinping thought’ in the party’s constitution at the 19th National Congress of the Communist Party of China
      October 27 : Catalonia declares independence from Spain
      November 4 : S audi Arabia detains 11 princes, four ministers and ten former ministers in a corruption probe
      November 12 : Iran-Iraq magnitude 7.3 earthquake kills more than 500
      November 15 : Argentine navy submarine disappears with 44 crew on board
      November 21 : Robert Mugabe resigns as Zimbabwe’s president after 37 years in power. His former deputy Emmerson Mnangagwa will become president.
      November 22 : Bosnian Serb army commander Ratko Mladic convicted of genocide in Srebrenica during the 1990s Bosnian War
      November 24 : Gunmen kill hundreds at Sinai mosque in Egypt
      December 4 : Houthi militants assassinate Yemen’s former President Ali Abdullah Saleh
      December 5 : Russia banned from 2018 Winter Olympics for state-sponsored doping
      December 6 : US President Donald Trump recognises Jerusalem as the capital of Israel
      December 17 : Price of one bitcoin reaches a new high of $19,783.06 dollars
      December 21 : Yemen’s cholera outbreak
      December 22 : Syria peace talks in Astana (compiled)

      Top ten most visited cities

      Between January and August 2017, destinations worldwide welcomed 901 million international tourist arrivals (overnight visitors), 56 million more than in the same period of 2016 .The top ten most visited cities are:
      HONG KONG26.6 million
      BANGKOK 21.2 million
      LONDON19.2 million
      SINGAPORE16.6 million
      MACAU15.4 million
      DUBAI14.9 million
      PARIS14.4 million
      NEW YORK12.7 million
      SHENZHEN12.6 million
      KUALA LUMPUR12.3 million

      Source: Euromonitor International

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