Travel

Grim outlook for air transport

The International Air Transport Association (IATA) announced a revised outlook for the global air transport industry with losses of US$4.7 billion in 2009. This is significantly worse than IATA's December forecast for a US$2.5 billion loss in 2009, reflecting the rapid deterioration of the global economic conditions.

Industry revenues are expected to fall by 12 per cent to US$467 billion. By comparison, the previous revenue decline, after the events of 11 September 2001, saw industry revenues fall by US$23 billion over the period of 2000 to 2002 (approximately 7 per cent).

Grim state

"The state of the airline industry today is grim. Demand has deteriorated much more rapidly with the economic slowdown than could have been anticipated even a few months ago. Our loss forecast for 2009 is now US$4.7 billion. Combined with an industry debt of US$170 billion, the pressure on the industry balance sheet is extreme," said Giovanni Bisignani, IATA's Director General and CEO.

Demand is projected to fall sharply with passenger traffic expected to contract by 5.7 per cent over the year. Revenue implications of this fall will be exaggerated by an even sharper fall in premium traffic. Cargo demand is expected to decline by 13 per cent. Both are significantly worse than the December forecast of a 3 per cent drop in passenger demand and a 5 per cent fall in cargo demand. Yields are expected to drop by 4.3 per cent.

Falling fuel prices

Falling fuel prices are helping to curb even larger losses. With an expected fuel price of US$50 per barrel (Brent oil), the industry's fuel bill is expected to drop to 25 per cent of operating costs (compared to 32 per cent in 2008 when oil averaged US$99 per barrel). Combined with lower demand, total expenditure on fuel will fall to US$116 billion (compared to US$168 billion in 2008).

"Fuel is the only good news. But the relief of lower fuel prices is overshadowed by falling demand and plummeting revenues. The industry is in intensive care. Airlines face two immediate fundamental challenges: conserving cash and carefully matching capacity to demand," said Bisignani.

Regional differences remain significant:

Asia Pacific: Carriers in this region continue to be hardest hit by the current economic turmoil and are expected to post losses of US$1.7 billion (significantly worse than the previous loss forecast of US$1.1 billion). Japan, the region's largest market is expected to see GDP drop by 5.5 per cent in 2009 with exports already in freefall. China has been successful in stimulating demand in domestic markets with pricing adjustments. International demand to and from China is expected to contract by between 5 per cent and 10 per cent over the year. India, whose market for international air services tripled in size between 2000 and 2008, is expected to see capacity increase by 0.7 per cent in 2009, while demand drops between 2 per cent and 3 per cent. Overall, the region is expected to see a 6.8 per cent fall in demand but only a 4.0 per cent drop in capacity.

North America: Carriers in this region are expected to deliver the best performance for 2009 with a combined US$100 million profit. A 7.5 per cent fall in demand is expected to be matched by a 7.5 per cent cut in capacity. Despite the worsening economic conditions, this is relatively unchanged from the earlier forecast of a US$300 million profit. Carriers are benefiting from careful capacity management and lower spot prices for fuel.

Promoting business with Benlux countries

Sri Lanka-Benelux Business Council (SLBBC) of the Ceylon Chamber of Commerce hosted a lunch for the Ambassador for the Netherlands, Ms. Leoni Cuelenaere at Colombo Club, Hotel Taj Samudra. Honorary Consul of Belgium Pierre Pringiers and key officials of the Royal Netherlands Embassy, Consulate of Belgium and members of the Sri Lanka Benelux Business Council were present at the occasion. Making the welcome address, Sega Nagendra the President of SLBBC said that Sri Lanka-Benelux Business Council which comprises the Netherlands, Belgium and Luxembourg was inaugurated in April 1992 on the initiative of the former Director General of the Board of Investment, Lakshman Watawala and the former Ambassador for the Netherlands in Sri Lanka, H.R.R.C. Froger.

SLBBC is formed under the aegis of Ceylon Chamber of Commerce and functions as a promoter and facilitator of trade, investment and tourism between the Benelux countries and particularly to promote exports. SLBBC also actively involved in encouraging establishment of joint ventures in Sri Lanka between Benelux countries and Sri Lankan Investors, Exchanging information on trade and investment with the appropriate bodies in the Benelux countries, conducting joint meetings with the Benelux countries' business organisations in Sri Lanka and in the Benelux Countries and serving as the recognised representative of the business sector interests in Sri Lanka in matters concerning business relationships with Benelux countries.

Convention Bureau enters Russian market

With the participation in the MICE forum and Moscow International Travel and Tourism Exhibition ( MITT), Sri Lanka Convention Bureau enters the Russian MICE market with a positive note. 'We waited for the right time and moved in at the most opportune occasion when two important events were taking place' says Vipula Wanigasekera, General Manager of Sri Lanka Convention Bureau.

Currently, the Russian commercial sector accounts for a vast number of meetings and incentive groups that travel abroad.

The MICE Business from Russia (meetings, incentives, conferences and exhibitions) is therefore expanding while being rated to be a multi-million dollar business which does not follow traditional operational mechanisms. The Moscow International MICE Forum held on March 17 brought in high level international specialists in addition to the Russian buyers.

Tourism Show

The event was conveniently organised one day before the MITT so that the buyers and sellers could proceed to MITT immediately after the MICE Forum.

The Moscow International Travel and Tourism show (MITT) celebrated the 15th anniversary as the largest travel industry event in Russia which is attended by Sri Lanka Tourism Promotion Bureau every year. Sri Lanka Embassy led by Sri Lanka's envoy Udayanga Weeratunga played a key role in Sri Lanka's participation in both events which were also complemented by the Sri Lanka Tea service drawing a large number of visitors to the Sri Lanka pavilion.

Branding

The theme of the pavilion was built on the new Branding and Positioning of Sri Lanka in the travel world. The ' Small Miracle' was portrayed prominently and Ambassador Weeratunga explained to the Russian Travel Trade, Journalists and other official dignitaries attending the special reception organised at the Embassy, the reasons for the new branding. He also explained the future plans of Sri Lanka to develop tourism from Russia and the work the Embassy has undertaken.

Among the distinguished invitees for this reception were Dr. Ahmed Ali Sawad and Dr Ibrahim Didi, Maldivian Minister of Tourism and Minister of Agriculture respectively.

Exclusive selection of Cake Cards

An expansive new range of Cake Cards has been added to the Cinnamon Grand's existing Cake Cards menu due to overwhelming demand and the public's entreaties for more ways to express themselves. The new selection has been added to the current series and has now been dubbed the 'Expressions' cake range.

Over sixty new Cake Cards cover many celebratory occasions and champagne moments such as birthdays, anniversaries and Christenings expressing whatever the heart may want to say! Now, no matter the occasion, customers will have an exclvsive selection of Cake Cards to choose from.

Patrons can also leaf through the Cake Cards album to decide on the perfect Cake Card and personalize the sentiment behind the message.

The Cake Cards concept revolved around the premise of introducing a unique gift to the public, one that combined a delicious treat with a simple and sweet message. This loving sentiment comes wrapped in a beautiful box with an option for a personalised message!