Middle East carriers’ freight volumes increased by just 0.1% year-on-year in December while capacity increased 4.5%, the International Air Transport Association (IATA) said on Wednesday.
The December growth contributed to an annual increase in demand of 3.9% in 2018 – the third fastest growth rate of all the regions.
Annual capacity increased by 6.2%, IATA said, adding that the region continues to be affected by geopolitical issues.
Globally, IATA said that demand grew by 3.5% compared to 2017. This was significantly lower than the 9.7% growth recorded in 2017.
Freight capacity rose by 5.4% in 2018, outpacing annual growth in demand. This exerted downward pressure on the load factor but yields proved resilient.
Air cargo’s performance in 2018 was sealed by a softening in demand in December. Year-on-year, December demand decreased by 0.5%, the worst performance since March 2016.
International e-commerce grew in 2018 which was a positive factor for the year but global economic activity weakened as did the export order books of all major exporting nations, with the exception of the US, in the second half of 2018.
“Air cargo demand lost momentum towards the end of 2018 in the face of weakening global trade, sagging consumer confidence and geopolitical headwinds. We are cautiously optimistic that demand will grow in the region of 3.7% in 2019,” said Alexandre de Juniac, IATA’s director general and CEO.
Source: Arabian Business