Airport infrastructure and passenger numbers

At the recently concluded 58th conference of Directors General of civil aviation Asia and Pacific region, the Airports Council International (the voice of the world’s airports), in its presentation raised three items for consideration, namely: “The Conference is invited to: a) recognise the imperious need to address the capital expenditure needs and decarbonisation challenges to accommodate future demand for air travel and ensure the sustainable development of airports, and that delay in addressing decarbonisation would incur additional costs in the future; b) encourage States to incentivise airport infrastructure developments with appropriate financial mechanisms, support the energy transition, and facilitate access to green finance for aviation; and c) encourage the development of economic and financing frameworks that incentivise and facilitate CAPEX in an economically sustainable manner that involves consultation with industry stakeholders.” 

In looking at the challenge of air travel growth, Airports Council International, in its latest ACI World Airport Traffic Forecasts 2022–2041, total passenger traffic worldwide is predicted to grow at a compound annual growth rate (CAGR) of 7.5 percent from 2021–2041, and would get to 19.3 billion passengers. In line with the Paris Agreement, the aviation industry has committed to the ambitious long-term environmental goal of reaching net zero carbon emissions by 2050.

The global passenger volume was forecast to reach 10.5 billion passengers in 2023 before COVID-19 pandemic. Presently, global passenger volume projection is expected to get to about 8.6 billion passengers, that is, 94.2 percent of the 2019 level.

The projection for 2024 is more optimistic at 9.4 billion passengers for global passenger recovery. This will be 102.5 percent of the 2019 passenger traffic of 9.2 billion passengers. This is information released by the Airports Council International.

Looking ahead for Africa the projections are also optimistic – the pattern will be steadily increasing, getting to 221 million passengers, or 96.3 percent of the level in 2019, in the year 2023. The forecast for the Africa region by the end of 2024 is 253 million passengers, which is 110.6 percent of the level in 2019. Emerging markets such as Egypt, Morocco and Tunisia are expected to be the drivers of this growth.

The Oxford Business group had stated about aviation in Nigeria: “The aviation sector’s growth potential is presently constrained due to the generally poor condition of its air facilities. Improvements to the country’s airport infrastructure could encourage additional international airlines to serve Nigeria and contribute significantly to its economy .” With the aim of achieving a one trillion dollar economy by 2026, the aviation industry in Nigeria cannot be overlooked in the coming growth in global aviation.

By the end of 2023, the Asia- Pacific region is expected to reach 2.9 billion passengers, or 87.3 percent of the 2019 level. The region is expected to reach approximately 3.4 billion passengers, or 99.5 percent of the 2019 level, in 2024. This will be as a result of uncertainty from both upside and downside factors, ACI states in a media statement.

By the end of the year 2023, around 2.3 billion passengers are expected in the Europe region, or 95.5 percent of the 2019 level. This will further increase in the year 2024, but at a slower pace, to around 2.5 billion passengers, or 101.4 percent of the 2019 level.

The Latin America Caribbean region in 2023, is estimated to reach 707 million passengers, or 102.9 percent of the 2019 level. The region is expected to welcome 759 million passengers, or 110.5 percent of the 2019 level, in 2024.  Same as the Africa region, emerging markets such as Colombia and Mexico are predicted to drive the region beyond the 2019 level.

For the Middle East region, prior to the current conflict between Israel and Palestine, the outlook had been very optimistic. From the report of ACI, the Middle East region was the fastest-recovering market in the year 2022. In the year 2023, the region is predicted to continue its recovery and reach 394 million passengers, or 96.8 percent of the 2019 level. In 2024, the passenger number is projected to be 429 million, or 105.4 percent of the 2019 level. This forecast may be impacted by the economic circumstances of neighboring markets and the current conflict in the region.

The North American region showed a strong recovery during 2021 and 2022, driven by domestic travel, its growth for the next couple of years is expected to continue at a slower pace. In the year 2024, passenger traffic in the region is forecasted to reach 2.1 billion passengers, or 103.7 percent of the 2019 level. By the end of 2023, the region is estimated to reach near the 2019 level with 2.0 billion passengers, or 99.8 percent of the 2019 level.

With growth in passenger numbers, there will be a need for airport infrastructure investment, which requires significant capital planning. Africa, for instance, will be expected to require $32 billion in CAPEX from 2021 to 2040. The global CAPEX needed from 2021 to 2040 is about $2.4 trillion, which is more than the GDP of Italy. ACI states further that falling short of CAPEX requirements by 2040 has implications. In 2040, it states, for every one million forgone passengers due to airport capacity constraints, the global air transport industry would support 10,500 fewer jobs and $346 million less in GDP.

The way forward can perhaps be said in the words of ACI in introducing the Airport System Capacity Enhancement Programme: “Improvements in capacity usage can reduce delays and inefficient operations that can result in additional costs for airports, ANSPs and aircraft operators, as well as disruptions for passengers. In some cases, improvements can be made that enable the deferral of costly infrastructure or system investments and contribute to aviation’s ambitious emissions reduction goals.”

For now, no airport should be left behind in the drive towards airport capacity enhancement. It has a direct effect on the customer experience and the earnings of an airport.