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Feb 18, 2008
Growing air travel sector may defend Asia against recession woes
By Karamjit Kaur

CONTINUED good growth in Asian air travel will spare airlines in the region the worst if a recession hits the United States this year, as many are predicting.

In fact, Mr Giovanni Bisignani, director-general and chief executive officer of the International Air Transport Association (Iata) - which groups about 240 airlines - said traffic in Asia is expected to grow by about 6 per cent this year.

Driving this will be the twin engines of China and India with booming economies that are fuelling strong demand for air travel.

Speaking to reporters on the sidelines of the inaugural Singapore Airshow Aviation Leadership Summit, Mr Bisignani said American carriers will bear the brunt of a global slowdown, especially if domestic business travel in the US takes a hit.

Singapore Airlines (SIA) chief executive officer Chew Choon Seng agreed with his assessment, saying the carrier's 'good network to India and to China, as well as a buoyant situation around the South-east Asian region' means it could be in better position than some others to ride out a US downturn.

But SIA is not immune from global economic trends, Mr Chew said, and stressed that it was prepared for the worst.

SIA's contingency plan if economic prospects go south includes redeploying aircraft and capacity.

He did not elaborate but experts suggest the airline could move US-bound capacity and beef up services to China and other strong markets to cushion itself against the impact of the slowdown.

Mr Chew and Mr Bisignani were among about 200 aviation experts representing airlines, airports and civil aviation organisations who had gathered at the Raffles City Convention Centre for the inaugural summit, held as part of the first Singapore Airshow, which officially kicks off on Tuesday.

Read the full story in Tuesday's edition of The Straits Times.

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