Middle East aviation sector strong and poised for growth

This was the message delivered to the 4th Annual Middle East & Africa Airfinance Conference today by Gordon Dixon, CEO of Oasis International Leasing of Abu Dhabi.

Dixon told the gathering of senior level aviation, finance and banking professionals that despite the small size of the Middle East in the overall world aviation market, passenger demand for seats will fuel the continued expansion of existing and new airlines operating in and from this region. He noted the 17.6 per cent growth of passenger traffic in the first half of this year as compared to a worldwide average of 6.7 per cent growth.

"The region was one of the first to recover from the slowdown of air travel post 9/11 and despite its cyclic history, the airline industry will continue its unprecedented growth here," Dixon said. "The oil-driven economies of the Gulf nations are enjoying a boom in economic expansion and property/infrastructure development. The increasing liberalization of trade restrictions coupled with the availability of capital will ensure this region continues its remarkable growth. The demand for air travel will increase with economic expansion," he said.

Dixon noted the strategic and human links between the Middle East and its traditional trading partners in Africa, Asia Minor and the subcontinent, and noted the new relationships with Russia, China and the Far East. He predicted that low cost air carriers will continue to drive the expansion of airline seat capacity.

"The low cost carriers are only beginning to tap the huge potential of the expatriate markets of the Middle East. Air travel has become affordable for many passengers who could not afford to buy a seat on the national carriers in the past. This demand is not going to slacken and low cost carriers will either expand or be created to accommodate rising passenger volumes. The expansion of the economies is also producing business and investment opportunities both here and abroad that is driving demand for seats," Dixon said.

Dixon cited the recent lease agreements Oasis has signed with Etihad Airways and two of the new Saudi startup carriers Sama and National Air Services (NAS). Now with 50 per cent of the world's airliner fleet financed through leasing agreements, he forecast that the growing airlines of the region can be expected to consider leasing as a means of financing the expansion of their commercial fleets in the future.