Dubai Airports CEO, Paul Griffiths, stated that the aviation industry’s “model is broken” in a guest column for Arabian Supply Chain (09-Aug-2010). Mr Griffiths believes there is “a growing need for pro-aviation policy, partnerships and global perspective”. He encouraged foreign governments to observe Dubai’s aviation industry model, which he believes will “stem the flow of red ink and improve the financial sustainability” of the industry.
Highlights of Mr Griffiths’ column include:
- Aviation sector: Dubai has a “thriving” aviation sector that features the third busiest airport for international passenger and cargo traffic, the world’s largest single airport retail operation and one of the fastest growing and most profitable airlines in the world. Aviation generates 25% of the emirate’s GDP – it is included in Dubai’s strategic plan and a long-standing open skies policy;
- Traffic growth: While global aviation recorded the worst demand decline in post-war years in 2009, Dubai International recorded 9.2% passenger traffic growth, making it the world’s fastest growing major international airport. Annual passenger traffic at Dubai is forecast to grow from 41 million in 2009 to 98 million in 2020 and 150 million passengers by 2030;
- Primary factors behind Dubai’s success: A pro-aviation government policy, industry-government partnership and a vision that embraces the changing industry dynamics driven by globalisation;
- Foreign governments: Most governments treat aviation as a “pariah and choke its growth with costly, misdirected regulation and parasitic forms of taxation, whose revenues usually flow straight out of the sector”, noting that the British Government is “top-in-class in this regard”. The recent decision to stop construction of a third runway at Heathrow “effectively snuffs out the considerable economic growth”;
- Emirates: The airline is “run as a fully commercial business and treated like any other airline at Dubai International in terms of airport and landing charges. The airport is government owned, however, it is run efficiently, it is cash positive and revenues generated are re-invested into infrastructure";
- Government-industry cooperation: Close alignment of government and industry has boosted growth and efficiency as resource planning, facility investment and expansion are coordinated and supportive of airline growth strategies and fleet acquisition plans.