Air cargo linked to global trade

There is a clear link between a country’s air cargo connectivity and its participation in global trade, according to a study produced by The International Air Transport Association (IATA).

It found that a one per cent increase in air cargo connectivity was associated with a 6.3 per cent increase in a country’s total trade.

“Air cargo is key in supporting the current global trading system. In 2015, airlines transported 52.2 million metric tons of goods, representing about 35 per cent of global trade by value. That is equivalent to US $5.6 trillion worth of goods annually, or US $15.3 billion worth of goods every day,” said Brian Pearce, chief economist at IATA.

“We now have quantitative evidence of the important link between air cargo connectivity and trade competitiveness. It’s is in the economic interest for governments to promote and implement policies for the efficient facilitation of air cargo.”

The study, commissioned by IATA, was conducted by Developing Trade Consultants. It identified a series of legislative priorities include the ratification and implementation of:

* 1999 Montreal Convention to enable countries to adopt e-freight

* World Trade Organisation Trade Facilitation Agreement and World Customs Organisation revised Kyoto Convention to implement smart border solutions that reduce complexity and costs.

The practical industry modernisation priorities highlighted by the study include:

* Facilitation of electronic processing, through electronic Air Waybills (e-AWB) and e-freight

* Implementation by governments of “single window” processing – ultimately enabling submission of all regulatory documents for trade via one channel

* Coordinated border agency procedures to reduce duplicative controls

* Implementation of risk management controls at borders to combat illicit activities and facilitate compliant traders

* Implement processes to approve release of shipments in advance of their actual arrival.