Abu Dhabi, UAEMonday 21 October 2019

Trade wars impact global air freight demand globally

Dnata president expects cargo volumes to continue to be impacted until trade dispute is settled

 Trade tensions between the US and China are impacting air freight demand, Gary Chapman, president of Dnata said.  Pawan Singh / The National 
 Trade tensions between the US and China are impacting air freight demand, Gary Chapman, president of Dnata said.  Pawan Singh / The National 

The trade tensions between the US and China is impacting air freight demand globally, the president of Dnata said.

“At the moment, the problem is geo-political situation,” Gary Chapman told The National on the sidelines of the Middle East and North Africa Leaders Forum in Ras Al Khaimah on Wednesday.

“The trade war going on between China and the US is spreading over. Generally, airfreight is down year-on-year and is not showing any signs of getting worse but it is down below where it was. Right across the globe, there is less cargo movement.

“In Dubai, we are down about between 5 and 6 per cent, year- to-date compared to the previous year. There are places in the world which are down about 10 to 12 per cent and globally, it is between 5 and 10 per cent.”

The comments come as global air freight markets suffer a 2.2 per cent year-on-year decline in demand in July 2019 as trade tensions between the world’s two biggest economies continue impacting the global economic growth, the International Air Transport Association (Iata) said in a report released last month.

Middle Eastern airlines saw the sharpest drop in freight demand of any region with freight tonne kilometres of cargo decreasing 5.5 per cent in July, compared to the year-ago period.

“There are no signs of improvement at the moment, until a resolution is found and things settle down between US and China, I suspect this will continue,” he said, adding Dnata is not looking to add new freight planes to increase its capacity due to the current downturn but will look for new opportunities to expand its operations globally.

“We just opened a new cargo facility in Heathrow and we are continuing to invest in the future and looking at new opportunities,” he said.

The ground handling division of Emirates airline also opened new catering facilities in seven different locations in the US, he added.

Dnata operates in 35 countries handling over 8,500 tons of cargo daily. The company made a profit of Dh1.4 billion during the 2018-19 fiscal year.

Updated: October 3, 2019 06:42 PM

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