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Travel becomes Asia’s key business battleground

By Jerry Maglunog

“The world is coming to Asia.”

These were the words of London City lord mayor Alderman Alan Yarrow when he visited the Philippines in February this year.

His red-carpet visit was full of hype as reporter’s who covered him need to pass through three strict screenings by the British embassy security staff before allowing entry to the VIP lounge of the Peninsula Manila hotel.

Indeed, Yarrow was like a prophet of truth because what he said is now occurring (sadly not for the Philippines, as most critics say).

In one part of his speech, he mentioned that air traveling is one of the keys to make Asia a real magnet for businesses and commerce.

The efficient and safety of air travel was also the message of Airbus, when it launched a three-day demonstration flight in Manila for its newest aircraft, the A350 XWB.

Sean Lee, the airline’s communications director for Asia, almost echoed what Yarrow said only on a different prospective. “Today, 30 percent of world’s air traffic comes from Asia.

In less than a decade it will double or at least grow 36 percent,” Lee told reporters.

He added to meet this growing traffic, airlines in Asia need at least 3,500 aircraft capable of bringing people to long haul journeys.

Even before both men predicted that Asia will become the center of commerce, business and tourism, Malaysia’s giant budget airline AirAsia already said that aviation traffic is already becoming crowded in most parts of Asia.

“Almost all Asian countries are doing their best to showcase their tourists’ areas. They cannot do that if they don’t have enough airlines to bring people from one place to another,” the airline’s group chief executive officer Tony Fernandes said in a forum.

Amadeus Air Traffic Travel Intelligence, a leading think tank in Asia, listed many pointers why Asia will become the next tourism hub of the globe.

“Among other key findings, the study reveals Asia as the market with the highest airline competition. Seventy-five percent of the region’s air traffic is operated by three or more airlines and 27 percent by five or more airlines, making this a region with a very intense competition in all its air travel routes,” it said.

“This contrasts sharply with other regions such as the Middle East and Europe where just half of all air traffic on its routes is operated by three or more airlines,” Amadeus said. One key to meet the demand is building many airports.

Vietnam is one country that is seems to be on track, according to the body. The former war-ravaged country has built three new airports near the iconic Tan Son Nhat. “It’s Long Than airport will make a difference. Watch out Thailand, Malaysia and Indonesia,” Amadeus said.

Long Than is a very controversial airport based on size, cost and distance from Ho Chi Minh, the country’s capital. However, the national government of Vietnam is not paying attention to criticisms and instead will go ahead with the construction of the airport.

It is dubbed as the “Dubai international airport of Southeast Asia” because of its mammoth size—five runways (all 5,000-meter long), 120 terminals and 100 million visitor capacity. In the Philippines, the Ninoy Aquino international Airport can handle 10 million visitors.

Lee also said that Vietnam Airlines will be the first in Southeast Asia to have its two A350s. “They will get it next month,” the Airbus official said. Both Amadeus and Airbus said that airports will play major role in this prognosis about Asia in the future.

Amadeus said the region’s three key airports of Dubai, Doha and Abu Dhabi, are all experiencing strong overall air traffic growth of around 10 percent per annum and they have very high levels of connecting traffic, with each airport seeing around 50 percent of its total air travel volume connect.

These figures demonstrate the region’s increasingly important role as a hub between Europe and the emerging markets of Asia and the South West Pacific.

When the three airports are taken as a group they already serve around 15 percent of air traffic volume between Asia—Europe and Europe—South West Pacific.

Overall traffic volume between Europe and Asia is growing by approximately seven percent year-over-year, but traffic volume between these two locations and routed via the Middle East grew by approximately 20 percent between 2011 and 2012.

“The rapid pace of change and increasing competitiveness of the global airline industry, as evidenced by this data, means airlines and the wider travel industry increasingly need to base operational decision-making on data insights and analytics, in order to identify opportunities and risks as they emerge,” said Pascal Clement, head of travel intelligence of Amadeus.

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