AIR CARGO RECOVERY TO TAKE OFF IN ASIA

AIR CARGO RECOVERY TO TAKE OFF IN ASIA

The airline industry is reeling from the debilitating effects of recession overseas and the consequent cut-throat competition that forced many airlines into bankruptcy in the past few years.

However, an upturn is in sight - at least in carrying cargo - and much of the growth will be in Asian markets, expected to account for about half the world market.Authorities as well as companies in Singapore are gearing up both for increased cargo traffic and more passengers.

Boeing Co. of Seattle projects the global air market growing an average 6.8 percent a year to 2010. It forecasts air cargo leaping to about 250 billion revenue ton-kilometers by 2010 from 80 billion last year. An RTK equals one metric ton of cargo transported one kilometer (five-eights of a mile).

David Hartman, managing director of the U.S. research firm DRI/McGraw Hill, agrees. The strongest growth figures in the 1990s will come from air links between Latin America at 11.6 percent, he says, with Europe-Asia accounting at 10.7 percent and intra-Asia at 9.9 percent.

With a 13 percent share of worldwide cargo in the year 2000, intra-Asian traffic will overtake the Europe-Asia route's 12.2 percent.

With this in mind, Singapore authorities will release some 75 acres of land next to Changi International Airport for construction of a zone for air freight warehousing and distribution centers.

Last year, the airport handled 719,000 metric tons of air cargo, an 11.8 percent jump on 1991. The Civil Aviation Authority of Singapore forecasts volume growing 6 percent to 8 percent a year to more than 1 million tons by the year 2000.

The aviation agency plans to expand Changi's air freight center capacity to 1.4 million tons by the end of the decade from 750,000 tons now. A fourth cargo agents' building is being built as well.

Flag-carrier Singapore Air Lines shifted its cargo operation into a separate division to reflect the sector's increasing importance as a revenue contributor. Cargo made up a fifth of SIA's 1993 revenues of S$5.6 billion (US$2.7 billion).

The airline has added its fourth all-cargo aircraft, a Boeing 747-400 to its fleet, an addition that will help expand its cargo network destinations to Bombay, India, Istanbul, Turkey and San Francisco. SIA flies cargo to 71 cities in 41 countries.

As much as 70 percent of air cargo handled in Singapore is transshipment goods.

Changi International Airport Services (CIAS) and SIA subsidiary Singapore Air Terminal Services are the two ground handling firms at the airport.