| by Dr. Ruwantissa
Abeyratne
( December 5, 2012, Montreal, Sri Lanka Guardian) In 1996,
pursuant to an initiative by the International Civil Aviation Organization,
which was robustly assisted by the Canadian Government, the United Nations
General Assembly, by resolution officially recognized 7 December as
International Civil Aviation Day and listed it as an official UN day. The purpose
of the global celebration is to generate and reinforce worldwide awareness of
the importance of international civil aviation in the social and economic
development of States, and of the role of ICAO in promoting the safety,
efficiency and regularity of international air transport. Each year on this day, ICAO celebrates this
global dedication with a theme. In 2012
the ICAO theme is “Aviation – Your Reliable Connection to the World”.
More importantly, in
December this year, Sri Lanka would be celebrating a hundred years of
aviation in Sri Lanka. This date has
been assured its place in posterity with
a wonderful book written just for the occasion by the talented Captain Elmo
Jayawardene: “A Centenery Sky – 100
Years of Aviation in Sri Lanka. In its back cover, I wrote the following:
“Nine years after Orville Wright achieved the first powered,
controlled, sustained and piloted flight on 17 December 1903, the people of
Ceylon watched the first wings take flight over the country’s verdant landscape. Not many who witnessed the birth of the
country's aviation sector could have imagined
that it would grow to the robust heights it has reached today. The conquest of the skies achieved in 1912 and the one hundred years that
followed tell a story filled with passion, courage and sacrifice. Aviation not only changed our life but also
inspired a legacy of abiding connectivity within our beautiful land and
beyond. It is only a seasoned aviator
who has experienced flight from the front with dedication and love for the
industry who can tell that story. In A Centenary Sky Captain Elmo Jayawardane takes us through an incredible journey of
hope and achievement with the enduring message that it is not the destination,
but the journey that counts”.
Yes, indeed, it is not the destination, but the journey that
counts. This is precisely why we have to
think of the years ahead for aviation in Sri Lanka. With such a long heritage of flight and a
distinguished record of safety, Sri Lanka remains highly respected within the
aviation community. However, it is time
we took stock of where we are headed, for the following reasons.
No matter how much we place emphasis on safety and security
in aviation, which indeed we must, we cannot forget that in the end there is
only one product – the air transport product – without which there would be no
need to talk of safety and security.
Therefore, the fundamental principle for air transport would
be aeronomics and how we administer the sky.
Let us start at the very beginning.
What is aviation’s strategic direction?
As far back as 1944, the world, represented then by 52 signatory States
to a multilateral treaty called the Chicago Convention - which now has 191 States acceding to it -
called aviation’s strategic direction
“creating and preserving friendship and understanding among the nations
and people of the world”. One would not
imagine, for a moment, that there is written anywhere in a global document that
aviation’s strategic direction is to make as much money as possible to the
exclusion of others or to give priority to the interests of States or the air
transport industry. Creating and
preserving friendship and understanding among people can only be achieved through
optimum connectivity.
I have said this before: The trouble with air transport is
that, while on the one hand it is a product, on the other hand regulations
pertaining to this product may constrain its availability to the consumer by
depriving him of the various choices of air travel he might have under a
liberalized system. In other words, State policy and the protection of national
interests take precedence over the interest of the user of air transport. The aviation industry offers only one product
to the ultimate consumer and that is the air transport product.
“Connectivity” which is the most compelling need in
aviation, and embodied in the Chicago Convention as inter alia “meeting the needs of the people of the world
for efficient and economical air transport”
is stultified by interests of commercial and national policy. Let me give just one example where this
insurmountable obstacle has been overcome.
When Emirates commenced its operations to Australia in 1997,
the airline was viewed with trepidation and concern by QANTAS, as a threat to its market share. This concern was shared by the Australian
authorities. However, attitudes quickly
changed, and this concern was obviated when they realized the added economic
benefit quickly enjoyed by the places Emirates flew to. Currently, Emirates operates 49 flights a
week to Australian cities and hopes to expand this number to 80. QANTAS and Emirates are now partners and
that…is the way to go.
I might also add that the air services agreement between the
UAE and the United States allows Emirates to operate to any point in the
States, how often they wish with no capacity restriction, and with rights to
carry traffic from intermediate points.
Air transport does not have a smooth trading passage. In
2009 IATA summed up the predicament of the air transport industry succinctly
when it says of the past.
“A hyper-fragmented global industry was struggling for its
survival. National flags were originally put on the tail to protect the
airlines. That was an age of regulated travel for the rich. Today we are an
industry that moves over 40 million tonnes of cargo and 2.2 billion people
annually. Our activities support 32 million jobs and US$3.5 trillion in
economic activity. The rules set to protect this industry do not work in
today’s environment. Even in good economic times, the industry has not covered
its cost of capital. Restrictions on ownership and market access have prevented
airlines from growing into strong global businesses.
The latest crisis is yet another reminder that there is no
policy purpose in keeping the industry financially weak with out-dated
restrictions”.
One could well argue that the trouble with air transport has
been that it has always been about State policy and interests of States and not
about the rights of the consumer.
Restrictions on Foreign direct investment (FDI) through rigid ownership and control policy
further strengthen this approach. FDI
promotes economic growth and facilitates competition.
Caps on FDI serve to obviate the need for governments to
invest, particularly when they have to protect ownership and control of
nationals in designated airlines. This is counter-intuitive as there will not
be ownership and control for governments to protect if the airlines go bankrupt
for want of capital.
Under the circumstances, and looking ahead, an airline
cannot be run on a commercial basis while being fettered by total State
control. This applies more so to an
airline that runs 22 aircraft and tries to compete with behemoths such as
Emirates, Etihad and even Qatar Airlines which has more than a hundred
aircraft.
Peter Harbison, Executive Chairman of CAPA Centre for
Aviation based in Sydney said, "As the Gulf carriers have progressively
disturbed the global airline equilibrium over recent years, 2012 has seen a
rapid escalation of this process. None has been more distinctive and
mould-changing than Etihad, under the leadership of James Hogan”.
Emirates has been named CAPA Airline of the Year (2012) for
the third time. Harbison went on to say: "Emirates has formulated a
comprehensive model which has become a game changer, most notably in 2012 as
its network density has gone to a new level. Its strategic leadership in air
services liberalisation, despite reaction in some markets, has helped transform
traffic flows, contributing to enormous strategic change in the industry. All
the while, Emirates has continued to be profitable in face of difficult market conditions".
With such rapid winds sweeping through the commercial
aviation world, what should Sri Lanka do?
We should take an example from
the visionary thoughts of the President of Sri Lanka which he put
forward at the launch of the space age of Sri Lanka when Supreme SAT-1 was launched into orbit. The President said in his message: “The
launch of this satellite will be the beginning of more such ventures that will
help promote Foreign Direct Investment, increase export earnings to the
country, and help greatly in the transfer of technology within and outside this
Region”.
I can see no reason why this same proactive approach cannot be adopted in the context of
commercial aviation in Sri Lanka and its national carrier!!
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