Olivier Jankovec, Director General, ACI EUROPE: “Liberalising aviation between the EU and ASEAN is not just about normalisation – it is about upping our game in response to increasing competitive pressures from other regions.”
The EU-ASEAN Aviation Summit brought together 300 political, business and air transport industry leaders, exploring the rich opportunities in both aviation markets and the benefits to both the EU and ASEAN of greater market access and integration in air services. ACI EUROPE was there, represented by Olivier Jankovec, Director General.
Pictured front row: Lui Tuck Yew, Singaporean Minister for Transport; Siim Kallas, European Commission VP (Transport); Sommad Pholsena, Lao Minister for Public Works and Transport; and Le Luong Minh, Secretary General of the ASEAN.
In 2011, ACI EUROPE launched a campaign on aviation liberalisation with the release of an external relations paper – Expanding Europe’s Aviation Market – Prerequisite for Global Relevance. This urged the opening of negotiations with the EU’s main trading partners in emerging markets, including ASEAN. Air traffic between the EU and ASEAN has almost doubled over the past 15 years and, with a combined population of 1.1 billion (largely middle class) consumers, the EU-ASEAN air transport market is of increasing strategic importance. However, a significant and expanding share of market growth is being diverted through competing hubs – especially in the Middle East. It is clear that realising the potential for future direct air traffic development between the EU and ASEAN (and lessening the competitive advantage of the Middle East hubs) requires an open, liberalised air services agreement.
Patrick Ky, Executive Director, EASA, drew some parallels between the EU and ASEAN aviation markets, including capacity constrained global hubs, high traffic volume over several air space areas, large presence of LCCs, global alliances, and aviation supporting a single market.
In this vein ACI EUROPE and ACI Asia-Pacific called for aviation negotiations to be initiated between the EU and ASEAN within a year, aimed at removing restrictions on air services, promoting the integration of the two regional single aviation markets, and seeking regulatory alignment on essential issues such as safety, security and competition. “Liberalising aviation between the EU and ASEAN is not just about normalisation – it is about upping our game in response to increasing competitive pressures from other regions,” said Jankovec. “We need to seize this opportunity for first-mover advantage before others reap the full benefit of unrestricted market access. Therefore Europe’s airports are fully behind the Commission’s efforts to open aviation markets with the EU’s main trading partners. Beyond our own positioning, experience shows that consumers are the biggest winners, and that there are other far-reaching benefits. For us as airports, it is about unleashing our potential to act as engines of economic growth for our communities – something not to be overlooked given the urgency of sustaining Europe’s economic recovery.”
Unlocking that potential will be given a big boost by the creation of an ASEAN Single Aviation Market, planned by 2015, but requiring significant political will. With some similarities to the single aviation market successfully created by the EU over 20 years ago, cooperation between the EU and ASEAN will become of central importance as Asia Pacific grows to become the world’s leading air transport market with a projected share of some 40% by 2030. In this time EU-ASEAN travel itself is expected to grow by 5% each year. Patti Chau, Regional Director, ACI Asia-Pacific, commented: “The Asian market – one of the fastest growing in the world – remains relatively segmented and regulated, thus undermining the competitiveness of the air transport industry and economy in the long-term. In the face of globalisation and increasing competition, the opening of a dialogue between EU and ASEAN on a single aviation market is very much welcome.”
Tan Sri Bashir Ahmad, President, ACI Asia-Pacific, and Managing Director, Malaysia Airports Holdings Berhad, participated in Session 2: Market Outlook and Business Opportunities in the ASEAN, EU and ASEAN-EU Aviation Markets.
Leading the EU delegation, Siim Kallas, Commission VP (Transport), added: “If Europe works together with ASEAN, we can extend the proven benefits of our single aviation markets to make a much larger inter-regional one. The Summit has created much new momentum for closer cooperation and made a convincing case for embarking on what could be the first aviation agreement in the world between two important blocs of countries like the EU and ASEAN.”
Looking forward, the Commission needs a negotiating mandate from the Council of Transport Ministers, and Kallas announced at the Summit that he will indeed soon be seeking this authorisation to enable negotiation of a comprehensive EU-ASEAN air transport agreement. Meanwhile, reflecting the strong desire on both sides to strengthen aviation cooperation, an ASEAN-EU Aviation Working Group is to be established to discuss and monitor progress towards an agreement.
