Middle East, true global connecting hub: Airbus GMF 2015
The Middle East's medium-term economic outlook remains supported by its substantial petroleum resources, close proximity to energy-hungry Asian economies, growing tourism potential and a strategically important geopolitical location. It is expected oil producers will continue to address their oil dependence by fostering development and activity in the non-oil sectors. Over the longer term, projections indicate real GDP growth for the region averaging 3.8% per year, clearly above the forecast World average growth of 3.2% over the next 20 years.
Air transport has been both a major driver and indicator of the growing importance of the Middle East in the global economy, also linking its main economic centres to the rest of the World. The extraordinary growth in both business and leisure passengers reflects the dynamism of the region, proving its success in diversifying beyond the energy sector and increasing its global footprint.
Over the past ten years, Middle Eastern airlines have spearheaded the region’s air passenger traffic growth. They have extended their presence to five continents, enabling air traffic to grow twice as fast as the economy. Since 2003, the capacity in terms of available seats has quadrupled to over 400 billion ASKs.
Unprecedented network development has created an air transport network in which Middle Eastern cities have become major hubs, linked to aviation mega-cities around the World.
The development of air traffic in the Middle East is unique – it is the only region in the World where the twin-aisle fleet is bigger than the single aisle. This aircraft capacity has been a key enabler of airline growth in the region in recent years. Long-haul traffic has been crucial for the development of Middle Eastern carriers.
Since 1995 the share of long haul traffic has increased from half to more than two thirds in 2014. Data shows that the strategic focus on this segment of the market was a resounding success: long haul traffic has been growing at 11 percent over the past 20 years, outperforming short haul by on average five percentage points.
Such high growth is enabled by a large proportion of connecting traffic. Middle East carriers have increased their share of connecting traffic over the past five years from 28 to 34 percent. Compared to other regions where connecting traffic represents less than 17 percent, Middle East and North America stand out with about a third of passengers connecting in the region.
It is also interesting to note that the share of connecting traffic passing through the Middle East, i.e. not starting or finishing their journeys there, is just 19% of the region total origin and destination traffic, especially as the perception is that the Middle East is just one large hub. Looking more deeply, just 15% of total Middle East O&D are in this inter regional “transiting” category for long haul passengers, with the remaining 5% on short-haul journeys.
Based on this year’s Airbus Global Market Forecast, passenger traffic for Middle East carriers is expected to grow at an average rate of 6.7% per annum for the next twenty years outpacing the global growth of 4.6% for the same period.