Russia’s deputy minister of transport Alexander Yurchik has called on the country’s airlines and airports to work with the government and Rosaviatsiya, the Russian federal air transport agency, to help shape the different programs aimed at boosting the industry’s growth. “Give us a hint with your advice. We have an integrated approach,” he told delegates of the Wings of the Future conference in Moscow last week.
Yurchik conceded that the spending mechanism might be too regulated and that investments in infrastructure did not always align with the aspirations of the airports but, he vowed, “the air [transport] system is going to be developed everywhere.” The government on October 30 held negotiations with a U.S. delegation, which Yurchik said expressed keen interest in Russia’s plan to develop its civil aviation structure. “They were amazed, astonished by the plan,” Yurchik recounted.
The plan calls for, among other elements, the reconstruction or upgrade of 66 airports, terminals, and runways across the country, the expansion of regional routes, and the creation of conditions for increasing flights bypassing Moscow. The system of incentives for regional air traffic bypassing Moscow is “working well,” Yurchik said, pointing out that that the growth rate of passengers on domestic services continues to exceed the overall growth rate. Overall year-on-year passenger growth stood at 11.2 percent in the first nine months, whereas passenger numbers on domestic services rose more than 25 percent.
Russia will remain by far the largest air transport market in emerging Europe and the Commonwealth of Independent States (CIS) over the next 20 years; however, forecasters expect its rate of passenger growth to run lower than in some other countries in the region, such as Kazakhstan, asserted Kate Markhvida, a senior economist at the International Air Transport Association. Markhvida identified a more liberal aviation policy and simplified visa procedures as key policy initiatives for Russia to fully unlock its air travel potential. The country performs poorly on several of IATA’s key parameters, including passenger facilitation, visa openness, and e-freight friendliness with scores of 2.3/10, 1/10, and 0.1/10, respectively.
“Air transport is important for local economies,” she said, noting that air transport and foreign tourists arriving by air supported one million jobs in the country and contributed 1.8 percent to GDP.
IATA forecasts Russia’s air transport market to grow by 77 percent in the next 20 years, to 182 million passengers by 2038. The association expects Kazakhstan, which adopted an open skies policy, to increase its passenger throughput by almost 150 percent—accounting for the highest growth rate of IATA’s ranking of the 10 largest passenger markets in emerging Europe and the CIS—to 20 million by 2038. That rate of growth will propel the central Asian country to become the sixth-largest air passenger market in emerging Europe and the CIS, up from the tenth position in 2018. Kazakhstan will gradually overtake Bulgaria, Croatia, Cyprus, and even Hungary, the IATA forecast showed.