Escalating geopolitical tensions in the Middle East threaten to undo the solid progress the region’s carriers are making in the air cargo market.
New data shows that in November, air freight volumes in the Middle East decreased 3% compared to a year ago, marking a significant improvement of the near 6% decrease in October.
But the International Air Transport Association (IATA) has warned that the escalating tensions in the region – sparked by a US drone strike in Iraq – could blunt the market’s progress in the region.
Air freight demand, measured in freight tonne kilometers (FTKs), decreased globally by 1.1% in November, compared to the same period in 2018. This marks the thirteenth consecutive month of year-on-year declines in freight volumes.
Despite the decline in demand, November’s performance was the best in eight months, with the slowest year-on-year rate of contraction recorded since March 2019.
While international e-commerce continues to grow, overall air cargo demand continues to face headwinds from the effects of the trade war between the US and China, the deterioration in world trade, and a broad-based slowing in global economic growth.
Alexandre de Juniac, IATA’s CEO, said: “Demand for air cargo in November was down 1.1% compared to the previous year. That’s better than the 3.5% decline posted in October.
“But it is a big disappointment considering that the fourth quarter is usually air cargo’s peak season. Looking forward, signs of a thawing in US-China trade tensions are good news. But trading conditions at present remain very challenging.”