Montreal, 24 February 2022 – Airports Council International (ACI) World has published its ninth quarterly assessment analyzing the economic impact of the COVID-19 pandemic, its effects on the global airport business, and the path to recovery.
It has been almost two years since the World Health Organization (WHO) declared the COVID-19 outbreak a global pandemic. Since then, there have been major impacts to daily life across the globe. However, we have now reached a potential turning point. Despite the more than 400 million infections across the globe and significant death toll, 10.5 billion shots of the vaccine have been administered worldwide in more than 180 countries. This unprecedented vaccination effort is now starting to bear fruits despite some setbacks from the recent Omicron wave. According to the WHO Director General, if we can achieve a 70% rate of vaccination for the world’s population by June or July 2022, we could be out of the acute phase of the pandemic this year, potentially fueling the global economic recovery, and air transport demand.
The crisis has resulted in a dramatic impact to the global economy, trade, and mobility. Just over two years after the first reported case of COVID-19, many countries are laying plans to return to some normality, lifting many health measures, relaxing travel restrictions, and reopening borders. In Europe, Switzerland recently followed in the footsteps of the Netherlands, Norway, and Denmark on this path. Australia has reopened its borders to all vaccinated visa holders at the end of February, after nearly two years since its border was closed to non-citizens. Other Asia-Pacific countries like Thailand, the Philippines, Vietnam, Indonesia and Singapore are also slowly reopening to vaccinated travellers. In the US, a growing number of states and cities have lifted restrictions or announced plans to relax them.
The momentum created by the plan to reopen will certainly have a positive impact on the global economic recovery. The performance of the global economy has accelerated in the last months of 2021 as more pandemic restrictions were removed, facilitating the trade in goods, and enabling the manufacturing and services sectors to grow.
The International Monetary Fund (IMF) however warns that the recovery faces multiple headwinds ranging from new potential variants, high crude oil prices, higher inflation, or supply chain disruptions. According to the IMF, global growth is expected to moderate from 5.9% in 2021 to 4.4% in 2022. High inflation levels are probably the most pressing downside risk that governments will target. Consumer inflation in the United States reached 7.1% in December, the highest rate in 40 years, forcing the Federal Reserve to announce its intention to raise interest rates; thereby placing the brakes on major economies. The success of those measures to control inflation will be a key determinant in the possibility that the economic momentum of 2021 could carry over into 2022. What’s more, the risk of armed conflict and increased international tensions could also dampen the speed and magnitude of the recovery.
On the vaccine front, the pace of vaccination has accelerated in core emerging markets in the past few months. However, many countries continue to fall well short of the commonly recognized threshold for herd immunity. Low vaccination rates mean that emerging and developing nations are more exposed to the virus and its variants, which increases the risk of new waves that could undermine the progress made until now.
In this overall context, this document seeks to highlight some key figures in terms of the impacts of the COVID-19 pandemic on airport traffic and revenues and explore pathways to recovery.