GENEVA: The International Air Transport Association (IATA) has released new estimates for the impacts of COVID-19 on air transport and economies in Europe in 2020, indicating a further deterioration in revenues, job prospects and economic activity across the entire continent.
IATA's latest economic forecast shows that in 2021 Europe is expected to be the worst-hit global region in terms of airline losses (minus USD 11.9 billion) and EBIT margin (minus 9.5 per cent).
Passenger traffic measured in revenue passenger kilometres (RPKs) is estimated to have fallen 70 per cent this year, the worst performance of any region with the exceptions of Africa (minus 72 per cent) and the Middle East (minus 73 per cent).
RPK growth next year is expected to be a weak 47.5 per cent, trailing the comparable regions of Asia Pacific (50 per cent) and North America (60.5 per cent). "Our projections for this year and next are little short of a disaster for European air transport. Border restrictions and quarantine measures have brought demand to a halt and the region has been affected even worse than most other parts of the world," said Rafael Schvartzman, IATA's Regional Vice President for Europe.
"There is optimism over a vaccine but as our forecast for next year shows, this is unlikely to come in time to prevent hundreds of thousands more job losses in the industry unless governments take immediate action,"he added.
Schvartzman said the focus must remain on rapid testing of passengers so that quarantine can be eliminated and borders safely opened. An in-depth look at the national level impacts shows that prospects for passenger numbers and industry revenues have declined across the board since the analysis in August.
This inevitably feeds into greater numbers of jobs at risk and negative economic impacts. Across Europe as a whole, more than seven million jobs have been lost or are at imminent risk due to the COVID-19 shutdown.
The impact of travel restrictions and quarantine on travel demand is clear. Intra-EU bookings are 81 per cent down for the period to January 10, 2021 compared to the usual curve.
Economic recovery will be hampered by the loss of connectivity that is being felt by European cities. Since 2019, total connectivity has declined by 68 per cent in Frankfurt, 67 per cent in London, 67 per cent in Paris, 66 per cent in Istanbul, 64 per cent in Moscow and 53 per cent in Amsterdam.
Schvartzman said people are desperate to visit far-flung families this winter. Businesses are desperate for travellers and trade. "And we are all desperate for action from governments to safely restore the freedom to travel," he said.