Business

IATA sees strong growth
in Indonesia

The International Air Transport Association (IATA) says Indonesia is poised to become one of the fastest growing markets for the airline industry despite the current financial crisis.

IATA director general and CEO Tony Tyler said in Jakarta on Thursday that in 2014 Indonesia would rank as the world’s ninth-largest market for domestic flights.

“The potential for aviation in Indonesia is enormous. Alongside its significant domestic traffic, its location at the heart of Southeast Asia gives this market tremendous potential. As ASEAN moves forward with liberalization, it is important that Indonesia is well prepared with a safe industry operating on infrastructure that meets global standards,” Tyler said.

He said that by 2014, international traffic to Indonesia was expected to be about 22.7 million passengers, with a compound annual growth rate of 9.3 percent between 2010 and 2014.

The size of the domestic market is expected to be 38.9 million passengers in 2014, which is a compound annual growth rate of 8.7 percent between 2010 and 2014.

Meanwhile, freight is forecast to be 300 million tons, a compound annual growth rate of 9.4 percent between 2010 and 2014.

Addressing issues in Indonesia is a priority for Tyler during his first visit to Asia as IATA chief.

He met flag carrier Garuda Indonesia president director Emirsyah Satar, Transportation Minister Freddy Numbery and officials from state airport operator PT Angkasa Pura II.

“Indonesia has a lot to gain from this in terms of both trade and tourism facilitated by stronger air links. But, this will only come if we can successfully address the challenges of safety and infrastructure, and with government policies that are coordinated to ensure the efficiency of the system,” he said.

Having the right infrastructure to accommodate growth was critical, both on the ground and in the air.

“It also means having the right processes to handle passengers efficiently. A solution is urgently needed. Without sufficient capacity in Jakarta, Indonesia risks missing the economic benefits that should accompany ASEAN liberalization in the coming years,” he said.

Soekarno-Hatta International Airport urgently needs additional capacity because traffic reached 43.7 million passengers in 2010. This already surpassed the 38 million passenger capacity had after Terminal 3 became fully operational.

IATA is providing technical assistance for more effective use of the airspace in the Jakarta area but full implementation is still uncertain.

Likewise, the leading edge Automatic Dependent Surveillance–Broadcast (ADS-B) technology is already in place to manage over-flight is not being used yet.

Tyler said the implementation of both programs was critical to ensuring that growing air traffic was managed safely and efficiently.

However, he said that Indonesia had made good efforts to address aviation issues, such as Garuda’s completion of the IATA Operational Safety Audit (IOSA), which represented the highest global standard for operational and safety management.

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