The International Air Transport Association (IATA), which is predicting a $7.1 billion loss for Middle East airlines this year amid the ongoing coronavirus crisis, on Saturday welcomed the imminent resumption of flights between Gulf countries and Qatar.
The global aviation authority said the signing of the AlUla agreement will pave the way for commercial airlines to resume regional connectivity which will shorten flight times and provide essential air links to families and businesses across the region.
The AlUla Accord was signed earlier this week at the 41st annual gathering of the GCC ending the three-year rift between Qatar, the UAE, Saudi Arabia, Bahrain and Egypt.
Muhammad Al Bakri, IATA’s regional vice president for Africa and the Middle East, said: “The reopening of airspace with Qatar by Saudi Arabia, Bahrain, United Arab Emirates and Egypt is welcome news for the region, passengers and the aviation industry during these very difficult times.
“It will permit the resumption of direct flights between these countries and Qatar, eliminating complex transit travel itineraries that saw typical journey times increase from under an hour to over five hours in some cases.
“The agreement will facilitate the transportation of Covid-19 vaccines globally given the region’s strategic location,” Al Bakri added.
His comments come on the day that the UAE has reopened its borders to Qatar following an announcement by Khalid Abdullah Belhoul, Under-Secretary of the UAE Ministry of Foreign Affairs and International Cooperation (MoFAIC) that the UAE will begin to end all measures taken against Qatar.
He said on Friday that from Saturday all land, sea and airports will be open for incoming and outgoing movement. He added that the UAE will work with Qatar to end all other outstanding issues through bilateral talks.
Seperately, the General Civil Aviation Authority (GCAA) announced the reopening of airspace and resumption of air traffic between the UAE and Qatar from Saturday.
Taimur Khan, head of research at Knight Frank, said the UAE’s tourism sector was likely to be first to see the benefit from the reopening of borders to Qataris.
He said: “In the likes of Dubai, other real estate asset classes such as Dubai’s hospitality sector, are more likely to see an immediate impact as Qatari tourists begin to return to the emirate. Whilst Qatari tourists were not so significant in terms of overall quantum of tourists visiting Dubai, where they accounted for 176,000 out of 14.9 million overnight visitors in 2016, their spending power and affinity towards luxury properties is likely to underpin stronger demand levels in this segment of the market.
“More so, as inbound tourism, both corporate and leisure, increases we will also see the emirate’s retail and F&B sectors also benefit from this trend.”
IATA said late last year that Middle Eastern airlines are expected to see their losses rise to $7.1 billion this year as the coronavirus pandemic continues to decimate the aviation industry.
The IATA figures also showed that air passenger demand in the region has slumped by 73 percent in 2020 compared to the previous year while capacity has also fallen by 64.5 percent
IATA also said full-year 2020 passenger numbers in the Middle East are forecast to reach only 30 percent of 2019 levels, down significantly from the 45 percent that was projected in July.
In absolute numbers, the Middle East is expected to see 60 million travellers this year compared to the 203 million in 2019.
The aviation authority said that a full return to 2019 levels is not expected until late 2024 in the Middle East region.
Globally, airline revenues last year are expected to plunge by 60 percent as a result of the coronavirus pandemic which threatens the survival of the industry, IATA also said.
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