The ongoing market liberalization, as well as the development of code-sharing agreements with airlines outside the region is continuing to boost air passenger flows across the Middle East. While the countries in the region are de-monopolizing and opening their aviation market, both local and foreign airlines, ground handlers as well as other industry players are spurring the competition thus creating a positive impact on the prices and quality of service. Furthermore, the successful implementation of such collaboration projects like the ones developed between South African Airways and Etihad Airways or Emirates and Qantas are also bringing more transit passengers to the region thus contributing to an average of 12.6% of the traffic growth during the first five months in 2013.
While North America and Asia-Pacific remain relatively slow developing regions (below 4%), the European market had shown a positive leap in air traffic. IATA reported a 5.6% market growth in May 2013 in comparison to May 2012. Stronger development reflects the economic optimism observed in the European economy. According to the OECD’s Economic Outlook, already in Q3 2013 the Eurozone is likely to experience a long lasting increase in GDP, reaching a growth rate of 0.7% and 1.8% by the end of 2013 and 2014 respectively. Though several larger players are still restructuring and redefining their businesses, the market conditions are strongly favourable for low-cost carriers such as Ryanair, EasyJet or Wizz Air. Naturally, such carries are continuing to further penetrate local European markets. Their confidence in regional market is clearly reflected in the recent order for 175 new Boeing 737-800s placed by the Irish low-coster.
