EU Aviation Sector,
Avoiding Unintended Consequences Of Legislation
By Steve Hall
February 8, 2012 - The International Air Transport
Association (IATA) urged European policymakers to focus
aviation efforts on measures to shore-up the
competitiveness of Europe’s aviation sector.
“Safety and security must always come first. But at this
critical time for European economies it is important
that policies focus on measures that support economic
growth and job creation, enhance competitiveness and
support sustainable development,” said Tony Tyler,
IATA’s Director General and CEO.
Tyler also urged policymakers to work with industry on win-win solutions. “There are numerous areas of common interest between what is good for the industry and what is good for Europe,” said Tyler. He noted that such an approach could help avoid “unintended consequences” of regulation.
“At present, the general direction is on ‘restricting and taxing’ aviation. Instead of ‘enabling’ policies, they seem focused on ‘disabling’—an unintended consequence that imposes a big cost on European airlines’ competitiveness,” said Tyler. Tyler’s remarks came in a speech to the European Aviation Club. Key points include the following policy priorities.
While IATA welcomed many aspects of the recent Airports Package,
Tyler highlighted the industry’s concern for the intention to
change the 80:20 use-it-or-lose-it rule to 85:15 for airport
slot management. “The current 80:20 rule is based on IATA’s
Worldwide Slot Guidelines which are used at 161 airports
globally. Changing this to 85:15 incentivizes airlines to fly
when demand is not there. Flying empty planes does not improve
competitiveness or environmental performance, which is surely an
unintended consequence. The focus should shift to building the
airport capacity needed to fulfill economic growth,” said Tyler.
European Sky (SES): SES will improve Europe’s competitiveness by
increasing airspace capacity, improving safety, cutting carbon
emissions by some 16 million tons annually and halving air
traffic management costs. The latest SES progress report notes
that only five out of 27 states are on track to meet agreed upon
targets to reduce delays and improve cost efficiency. And only
one out of the nine Functional Airspace Blocks is expected to
meet the year-end target deadline.
“This is a make-or-break year for SES. Europe cannot afford to fail. I appreciate the urgent efforts of Vice President Siim Kallas. If states cannot deliver results, then it is time for the Commission to drive a top-down approach,” said Tyler.
EU Emissions Trading Scheme (EU ETS): IATA continued to call for a global solution through the International Civil Aviation Organization (ICAO) as the key to breaking the impasse on Europe’s plans to unilaterally include international aviation in the EU ETS. “The unintended consequences of the unilateral and extra-territorial approach go beyond market distortions to states seeing this as an attack on their sovereignty.
am sensing a growing recognition in Brussels that a global scheme
developed through ICAO would provide a superior solution both for
managing aviation’s emissions and to resolving the political problems
caused by extending the scheme beyond Europe’s borders.
encouraging and we will do all that we can to promote a pragmatic
solution. But time is not on our side. Airlines from Europe may face
some retaliatory action. And some non-European airlines may have to
choose whether to obey the law of their land or that of Europe—two more
unintended consequences which should convince all states that ICAO is
the way forward,” said Tyler.
noted that sustainable biofuels were a key component of the aviation
industry’s commitments to cap net emissions from 2020 and cut them in
half by 2050 compared to 2005 levels. “To move from demonstration
flights to being a major component of the industry’s consumption, we
need the price to drop and the supply to increase.
consequence of current policy is driving biomass and investment towards
road transportation which has alternative energy sources. This urgently
needs to be redressed—not via blend mandates but by providing the right
policy incentives to attract investment and de-risk the scaling up of
commercial aviation biofuels projects,” said Tyler.
the economic benefits of aviation. “With austerity budgets across
Europe, export revenues from cargo and tourists are critical to support
jobs and GDP growth. Over 35% of the value of goods traded
internationally are transported by air. The 655 million people who flew
in Europe last year facilitated business and tourism. And the aviation
supply chain sustains millions of European jobs, which became visible
when the 2010 volcanic ash crisis brought Europe and much of the world
to a halt,” said Tyler.
IATA commissioned 54 studies from Oxford Economics to quantify the benefits of aviation at the national level. Highlights for major European economies include the UK where aviation supports 1.4 million jobs and 5% of GDP, France with one million jobs and 3.9% of GDP and Germany with 1.1 million jobs and 2.6% of GDP.
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