As the financial turbulence of the past few years threw a spotlight on a number of key industries and their respective roles in economic growth or decline, little notice has been taken of one sector that has consistently been creating and supporting jobs while making significant, to say the very least, contributions to the global economy — the aviation industry.
While aviation may not have been in the limelight as a catalyst for economic growth, the numbers speak for themselves. According to data from the Air Transport Action Group (ATAG), the industry supports an estimated 56.6 million jobs globally and contributes 3.5 per cent of the global gross domestic product (GDP). In fact, according to the ATAG, if aviation were a country it would be the 19th biggest economy in the world by GDP.
Here, in the Middle East, visionary leaders have long realised the aviation industry’s potential to drive economic growth and consequently invested heavily in establishing world class airlines that, in no small measure, create jobs, facilitate global trade and stimulate economic growth. ATAG’s data on the Middle East paints an incredible picture: by 2010, the region’s air transport industry created direct and indirect employment for 2.7 million people. It also contributed $129 billion to the region’s GDP.
From all indications, the industry’s growth is set to continue into the coming decades: Boeing’s Current Market Outlook has forecasted demand for 2,520 new airplanes in the Middle East by 2030, a clear indicator of a continued upward growth trajectory that will lead to further job creation and a larger contribution to the region’s economy. According to economic think-tank Oxford Economics, the aviation industry’s direct contribution to GDP will increase by 6.3 per cent per annum in real terms over the next 20 years, creating an additional 294,000 jobs in the region.
In the UAE, which is home to three carriers that are expanding at an exponential pace — Emirates, Etihad Airways and flydubai — the government has committed itself to facilitating this growth. This commitment is apparent in the UAE General Civil Aviation Authority’s (GCAA) sustained efforts to enter into air transport agreements with countries across the globe.
As a result of this effort the UAE has, at last count, signed agreements with close to 150 countries paving the way for its airlines to further grow their networks and leverage the country’s unique geographical advantage that allows them to connect virtually any city in the world. Significantly, the UAE has 104 ‘open sky’ agreements in place, which are designed to liberalise the flow of air traffic to and from partner countries.
The UAE itself is an excellent example of a forward-looking country whose government has implemented legislation to liberalise the aviation industry and create an environment conducive for growth. With 693,389 air traffic movements reported in 2011, the benefits are enormous. Its homegrown carriers have benefited from relaxed access to new markets allowing them, for instance, to launch direct routes from the Middle East to the Iberian Peninsula and South America. By expanding into previously untapped markets they are creating new opportunities for trade, travel and tourism.
The catalytic chain of interlinked economic events sparked by a burgeoning aviation industry is challenging to quantify because of the impact it has on so many different sectors, ranging from manufacturers to travel agencies.
For example, as passengers take advantage of affordable travel and businesses find it more cost-effective and efficient to air freight their products, the resulting demand not only generates revenues for airlines but also for the airports. Subsequently, the country’s aviation infrastructure also receives an impetus as investments are made to develop and improve airports and air traffic management systems.
Similarly, airlines will invest in airplanes to keep up with demand and expansion plans, hiring additional personnel to operate and maintain them. All of this combined with ancillary activities, in turn, creates job opportunities and contributes to economies around the world.
The tremendous amount of value the aviation industry adds to direct and indirect economic growth and job creation cannot be disputed. As the aviation industry continues to soar, it is only fitting that its role as a catalyst for economic growth and development should be recognised and celebrated.
Martin ‘Marty’ Bentrott is Vice President of Sales at Boeing Commercial Airplanes and is responsible for the Middle East, Russia and Central Asia region