Boeing has projected a demand for 6,810 new airplanes in China over the next 20 years, according to its annual China Current Market Outlook (CMO), which estimated the total value of those new airplanes at $1.025 trillion. China has become the first trillion dollar aviation market in Boeing's forecast.
The latest GDP figures show that China’s GDP growth is consistent at 6.7% but it is India that remains the fastest growing economy in the world at a rate of 7.1%. It is significant to note that the Philippines GDP growth rate is only 0.1% behind India. As India powers ahead, it seems to be taking Pakistan with it, which has seen strong GDP growth in 2016 thus far at an average of 5.7%. At the other end of the scale, Venezuela’s economy is contracting at a current annual rate of over 5%, with many predicting the collapse of the current government. Most airlines have ensured that exposure to the once great Venezuelan economy is minimal. In the background, there are concerns about the industrial figures coming out of Czech Republic where production has collapsed by over 10% in 2016, topped only by Egypt.
The takeaway from this little snippet is that the good action outside of the mighty USA market is in the Philippines and India. But, as mentioned before, if oil rose to anywhere over US$68 a barrel, most Indian airlines would find many routes running in the red, hence the dash for overseas exposure. The Philippines remains a perfect market for massive aviation growth because of geography if nothing else. As we said over two years ago now, it is the deregulation and growth of mega casinos that presents the most tantalising arena for growth over the coming years as the government opens up the gambling market further and allows building on remote islands that will play to big aviation growth.
Aviation 100 Asia & Pacific 2016 Awards Survey:
https://www.surveymonkey.co.uk/r/Aviation100AsiaPac2016
Aviation 100 Middle East & Africa 2016 Awards Survey:
https://www.surveymonkey.co.uk/r/Aviation100MidEastAfrica2016
Philip Tozer-Pennington
philipt@aviationnews-online.com