The impact of Brexit on the British travel industry

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The impact of Brexit on the British travel industry

The impact of Brexit on the British travel industry

The International Air Transport Association (IATA) released preliminary analysis of the financial and economic impact of the Brexit decision on the air transport industry.

“The Brexit vote has triggered much uncertainty—financial and otherwise. As leaders in the UK and the EU work to establish a new framework for their relationship, one certainty to guide them is the need and desire of people on both sides of that relationship to travel and trade. Air transport plays a major role in making that possible. There were 117 million air passenger journeys between the UK and the EU in 2015. Air links facilitate business, support jobs and build prosperity. It is critical that whatever form the new UK-EU relationship takes, it must continue to ensure the common interests of safe, secure, efficient and sustainable air connectivity,” said Tony Tyler, IATA’s Director General and CEO.

Preliminary estimates suggest that the number of UK air passengers could be 3-5% lower by 2020, driven by the expected downturn in economic activity and the fall in the sterling exchange rate. The near-term impact on the UK air freight market is less certain, but freight will be affected by lower international trade in the longer term.

A big issue is with aviation regulation. The UK faces a trade-off between accessing the European Single Aviation Market and having the policy freedom to set its own regulations.

Simon McNamara, Director General of the European Regions Airline Association (ERA), says “time will tell what this vote will mean for the UK and wider European aviation sector. Aviation is a global industry that works best in a borderless environment where the free movement of people allows airlines to move passengers seamlessly and without complication.”

As a European association, ERA represents both EU and non-EU member airlines and has associate and affiliate members from across the globe. “ERA represents its 53 member airlines at the highest levels in Europe,” says McNamara. “Our airlines face similar challenges and ERA protects and safeguards their interests whether they are members of the EU, European Common Aviation Area, or have chosen to negotiate a bilateral aviation agreement with the EU or another European country. Through our extensive experience ERA will continue to support our members flying to, from and within the UK as it becomes clearer what the implications of the vote are for the aviation industry.”

The World Travel & Tourism Council (WTTC) emphasises that travel to, from and within the EU and UK will not be affected in the short term. The process set out by the Lisbon Treaty allows for a two year period of negotiation once the UK formally states its intention to leave the EU, and this period could even be extended by agreement of all the parties. During this period the legislation around Travel & Tourism will remain unchanged.

David Scowsill, President & CEO, WTTC, said: “We are entering a period of market uncertainty which will undoubtedly put pressure on Travel & Tourism businesses, however we know that our sector is resilient and we expect business and leisure travel to hold up in the face of these challenges.”

Source = IATA - International Air Transport Association
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