Most international airports are state-owned: IATA

NEW DELHI: As the government proceeds with privatisation of six airports, global airlines body IATA has noted that most airports across the world are state-owned and aviation policy makers should take decisions in this regard keeping in view interests of airlines and passengers.

"The airport sector has not gone through the same process of structural transformation as the airline sector. Only nine per cent of European airports are in full private ownership, while 78 per cent remain fully publicly-owned," International Air Transport Association said in its latest report titled ' Airport Competition'.

According to the 2011-2015 National Plan of Integrated Airport Systems released by the US Department of Transportation and Federal Aviation Administration, there were over 19,700 airports in the US and, of them, 5,170 airports are open to the general public.

"Most US commercial service airports are typically owned by local or state governments, either directly or through an authority (a quasi-governmental body established to operate the airport)," says Airlines for America (A4A), a body recognised by US Congress and all government bodies.

It says "while Congress established a 'privatisation programme' in 1997 under which the airport ownership would be transferred to a non-governmental entity, no airport currently participates in this programme."

In its report, the IATA said the process of privatisation of airports "is far from complete and so many airports remain insulated from competitive pressures."
Referring to high airport charges, the airlines' body said even in 2010, at the height of the European economic crisis and with passenger numbers in decline, more than a third of European airports, including 23 of 24 major airports, raised their charges, compared with just 17 per cent that reduced them.

"Policy makers and regulators should be careful not to confuse corporatisation and commercialisation with competition. Robust, but proportionate, economic regulation is required to force airports to operate efficiently, fulfill core service obligations and moderate their charges," IATA chief Tony Tyler said in a foreword to the report.

He said lower charges not only benefited the passengers and cargo shippers that use the airports, but "encouraging greater connectivity also helps aviation act as a stimulus for economic activity, supporting trade, investment and jobs."

The report said with demand growth forecast outstripping the provision of airport capacity, "airport market power is likely to get stronger and so the prospects for competition between airports looks increasingly bleak."

The IATA report said airlines needed to serve airports that passengers want to use and therefore "face significant barriers, in terms of both cost and revenue."