Asia-Pacific aviation recovery boosted by China’s early reopening

LATAM Cargo & Swiss Airtainer SA won the IATA Air Cargo Innovation Awards 2023, Image via International Air Transport Association (IATA), Facebook

Asia-Pacific aviation is set for a gradual recovery this year, with the International Air Transport Association (IATA) citing China’s earlier-than-expected reopening as a significant boost for the industry. Philip Goh, IATA’s Vice-President for Asia-Pacific, noted that revenue passenger kilometres (RPK) for the region in April reached 82% of the corresponding period in 2019.

Domestic RPK has already surpassed 2019 levels, while international travel has recovered to 66%. Goh expects international travel to return to normal by 2025, taking at least two more years to fully recover.

This year, global aviation is projected to earn a net profit of US$9.8 billion on revenue of US$803 billion. However, the Asia-Pacific region is expected to lag behind with a net loss of US$6.9 billion. Goh anticipates financial improvement for the region next year, but there is no clear evidence of profitability.

Outbound flights from China have been a decisive factor in pushing regional traffic towards normal levels. Zhao Hongliang, Chief Executive of Juneyao Air, revealed that his airline’s flights between China and Thailand have recovered to 40% of the 2019 level.

Goh said “China is a huge aviation market which just reopened a few months ago with few remaining restrictions. For instance, visa requirements for Singaporean travellers, compared to visa-free travel before Covid-19.”

Chai Eamsiri, Chief Executive of Thai Airways International, expects a significant increase in Chinese travellers and other markets during the remainder of the year. However, he highlighted the challenge of supply side dependency, with manufacturers’ spare parts and tools still not back to normal due to staff cuts during the pandemic.

IATA is urging ten countries and territories to remove travel barriers, such as vaccination requirements in Indonesia and random on-arrival testing in India. Goh advised against implementing a 300 baht tourism tax in Thailand, as it could deter travellers. He also believes that traveller demand has recovered faster than the restoration of flight capacity and expects prices to moderate once more airlines add seat capacity to the market and jet fuel prices decrease, reports Bangkok Post.

Business News

Join the conversation and have your say on Thailand news published on The Thaiger.

Thaiger Talk is our new Thaiger Community where you can join the discussion on everything happening in Thailand right now.

Please note that articles are not posted to the forum instantly and can take up to 20 min before being visible. Click for more information and the Thaiger Talk Guidelines.

Alex Morgan

Alex is a 42-year-old former corporate executive and business consultant with a degree in business administration. Boasting over 15 years of experience working in various industries, including technology, finance, and marketing, Alex has acquired in-depth knowledge about business strategies, management principles, and market trends. In recent years, Alex has transitioned into writing business articles and providing expert commentary on business-related issues. Fluent in English and proficient in data analysis, Alex strives to deliver well-researched and insightful content to readers, combining practical experience with a keen analytical eye to offer valuable perspectives on the ever-evolving business landscape.