IATA still wary of protectionism after positive meeting with U.S. officials

Reuters News
Posted: Mar 14, 2017 5:38 AM

By Alexander Cornwell

ABU DHABI (Reuters) - Airline industry group IATA said it remains concerned about protectionist rhetoric from the United States and other governments, but also sees the new U.S. administration's plans to invest in infrastructure as positive for the industry.

IATA Director General Alexandre de Juniac told Reuters in Abu Dhabi on Tuesday that he met U.S. Transportation Secretary Elaine Chao in Washington D.C. on March 2.

He described the meeting to reporters as "positive", but said that IATA was also "heavily concerned" about plans by governments, including the United States, "to raise barriers on borders for trade and for travel".

"It was the opportunity for us to meet the new administration, to express our view and to understand what the new administration had in mind for aviation," de Juniac said, adding that U.S. plans looked positive in terms of investment in infrastructure and regulation.

U.S. President Donald Trump, who met aviation executives last month, proposed during his campaign to spend $1 trillion over a decade to upgrade the country's infrastructure.

"The plan to invest in infrastructure especially in airports is a good plan because there are some difficulties and weaknesses in the airline infrastructure in the U.S.," de Juniac told Reuters.

IATA and its members were critical of Trump's Jan. 27 executive order that blocked refugees and nationals of seven Muslim majority countries from traveling to the United States, and many in the industry said it caused chaos and confusion.

The Trump administration's revised travel ban is due to come into effect on Thursday.

De Juniac said U.S. officials had coordinated the second travel order with stakeholders, unlike the initial ban which came into immediate effect without notice.

IATA has not seen a significant impact on demand for travel to and from the U.S. as a result of ban, although data for February is still being gathered, de Juniac said.

Last week, Emirates President Tim Clark said bookings to and from the U.S. dropped 35 percent overnight after the January order. Others in the industry have also said demand has declined on U.S. routes.

Overall, IATA is concerned about "significant" protectionist rhetoric in the United States, Europe and other parts of the world, although it will take time before protectionist measures are felt in the industry, De Juniac said.

This year has started off better than expected, he said.

Passenger demand reached a five-year high in January. However, IATA said in December that it expects profit in the airline industry to fall this year after a five-year rally and de Juniac said that view remained unchanged.

(Editing by Susan Fenton and Susan Thomas)