The report, developed in partnership with Mott MacDonald — a global engineering, management and development consultancy— provides a snapshot of how airports in the region have performed during the first quarter of this year (January to March). This analysis also sheds light on two recurring themes which are currently impacting the industry — COVID-19 pandemic and the geo-political conflict.
The industry showed encouraging signs of recovery in the first quarter of this year— capacity was rebuilding in many parts of Asia Pacific and Middle East region; domestic passenger traffic made considerable progress; cargo growth has proven to be resilient and is above pre-pandemic levels. Despite the subdued pandemic environment, airports in the region continued to provide a safe and high service quality for the benefit of their passengers.
However, travel restrictions ranging from mandatory quarantines in designated facilities to pre-departure testing and on-arrival; suspension of international air travel in some parts of the region; geopolitical conflict and subsequent impacts on macroeconomic factors have proved to be detrimental to the overall growth of aviation.
Boosted by high rates of vaccination (70 percent or above in the six largest aviation markets), since early this year, many countries have been easing entry requirements, but parts of emerging and developed East Asia (Japan, Republic of Korea, Chinese Taipei, Hong Kong, Macau, China, Mongolia and Democratic People’s Republic of Korea) have kept quarantine requirements in place. In Asia Pacific and ME, currently 20 countries have no significant entry restrictions.
China plays a key role in the region as most of South East Asian Airports and Australia are largely dependent on Chinese travellers. The reopening of international air travel to and from China will not only accelerate growth in the region, but also provides a thrust to the industry across the globe.
While domestic passenger traffic has made considerable progress, with the easing of restrictions within some countries, international traffic, which is the key revenue driver for airports in terms of passengers’ commercial spend, has remained largely stagnant due to restrictions and geopolitical tensions in and around the region.
Considering airline seat capacity as a proxy to measure the flow of passengers, as compared to 2019 first quarter (Q1 data), domestic traffic has made a recovery of 92 percent of pre-pandemic levels, but international seat capacity was still down 67 percent during Q1 as travel restrictions, quarantine and testing requirements continued to hamper the growth of air travel.
The total domestic seat capacity is expected to recover to levels exceeding 2019 by Q2 2022 by approximately +4 percent. This is driven largely by Emerging East Asia (notably China), which has 15 percent more departing seats scheduled in 2022 than in 2019. Middle East domestic capacity remains below 2019 levels. In contrast, total international seat capacity in 2022 is 49 percent below 2019 levels, with significant variation between sub-regions. South Asia and the Middle East are only down about 15 percent on 2019 levels, while Emerging East Asia (China, Mongolia, Democratic People’s Republic of Korea) is still down by 81 percent, and is once again experiencing stringent travel restrictions.