UAE’s aviation charges alarm IATA chief

The United Arab Emirates has been slammed by the International Air Transport Association (IATA) for putting up aviation charges without consultation.

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By  Barbara Cockburn Published  December 4, 2006

The United Arab Emirates has been slammed by the International Air Transport Association (IATA) for putting up aviation charges without consultation. Managing growth profitably in the region is a issue of concern considering the rising price of fuel according to director general and CEO of IATA, Giovanni Bisignani. Fuel costs have dominated the drivers of airline financial performance over the past two years. In 2005, fuel costs accounted for US$91 billion or 22% of operating costs – almost double the 12% average experienced in the decade to 2003. According to IATA’s annual report published last month at the Arab Air Carriers Organisation annual general meeting in Kuwait, fuel costs in total are estimated to reach $112 billion in 2006, even though airlines have hedged en estimated 45% of the year’s fuel bill. “I have two concerns: that we don’t lose the plot on cost-efficiency and that we clearly differentiate growth and profitability,” said Giovanni Bisignani, IATA’s director general and CEO. He noted that the UAE “suddenly” increased charges for air navigation services by 63% in July and there are plans to increase charges for parking, landing and aerobridges. “All this without consultation. It is disappointing to see the UAE moving in the wrong direction,” he said

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