Physical Trade Infrastructure - ICAO
International Civil Aviation Organization (ICAO)
Tel: +1 (514) 954-8219,
Fax: +1 (514) 954-6077
ICAO’s activities in the area of Economics of Airports and Air Navigation Services include the development and provision of policy guidance on the economics and management of airports and air navigation services; the development of ICAO policies on user charges, promotion and implementation of relevant ICAO policies and guidance material; as well as monitoring regulatory and industry developments and trends, and conducting studies and research on related issues.
The programme deals with the economic, financial, organizational and managerial aspects of the provision and operation of airports and air navigation services, including issues relating to commercialization and privatization of such entities, the relationship between providers and users, the cost basis for charges, charging systems, and charges related to security and environmental protection. It collects, analyzes and disseminates information on the financial situation of airports and air navigation services. It also conducts workshops or other informal meetings to assist States and provides technical support to other bodies inside and outside ICAO on matters of its expertise areas.
The objective of the infrastructure management programme is to enhance and promote sustainable development of aviation infrastructure for the provision and operation of airports and air navigation services. The programme offers solutions to:
- improve the organizational and managerial capability of providers;
- reduce the financing burden on governments;
- protect user’s interests;
- allow early benefits of new technologies; and
- facilitate access to funding for long-term investment needs.
ICAO has developed various policies and guidance on user charges to recover the costs of providing airports and air navigation facilities and services from users.
These policies and guidance also address issues concerning how to design incentives for providers and users to reach cooperative agreements and to finance the modernization of the aviation system while obtaining the optimal effects of commercialization or privatization of aviation infrastructure.
Its activities include the following:
Monitor compliance with Article 15 of the Convention on International Civil Aviation (Chicago Convention) and application of ICAO recommended policies and practices in the area of cost recovery for airports and air navigation services, and so assist in the sustainable development of required infrastructure.
Develop and update ICAO’s Policies on Charges for Airports and Air Navigation Services (Doc 9082) and prepare related manuals and other guidance material on airport and air navigation services economics and management, including organizational aspects and implementation of CNS/ATM;
Provide advice and develop guidance on cost recovery, financing and organizational arrangements for multinational air navigation facilities/services including CNS/ATM and on means of addressing safety oversight and reducing shortcomings in the air navigation field; and
Provide technical support within and outside ICAO on issues related to airports and air navigation services management, cost-effectiveness and other economic and financial aspects of regional air navigation plans.
In the current environment of commercialization/privatization of airports and air navigation services, some consensus is needed on establishing and levying airport and air navigation charges. Without common international policies, airports and air navigation service providers would develop and apply their own principles, thus reducing transparency and leading to higher charges and governments finding reasons to increase taxation on international aviation.
Economic Development's contribution to Sustainable Development Goal 9
Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation
Develop quality, reliable, sustainable and resilient infrastructure, including regional and transborder infrastructure, to support economic development and human well-being, with a focus on affordable and equitable access for all.
ICAO is the custodial agency, providing data and analysis to the United Nations (UN), for air and other transport modes, in collaboration with UN partner agencies. This, in turn, provides crucial indicators for the Member States to monitor and benchmark their state of cross-border transport infrastructure. It provides a critical platform to States for evidence-based policy making to facilitate investments into infrastructure to drive the sustainable growth of air travel and benefit optimally from the potential offered by intermodal transport.
Joint financing activities
ICAO administers arrangements for the joint financing of air navigation facilities and services upon request and on behalf of some States and/or groups of States.
The provisions of Chapter XV of the 1944 Convention on International Civil Aviation (the Chicago Convention) and ICAO Assembly Resolutions provide the opportunity for joint financing arrangements. The general shortage of capital for the development of facilities and the growing emphasis on cost-effectiveness provide scope for the joint financing concept to be applied by two or more States to enable them to share in the cost of implementing and operating air navigation facilities and services for international civil aviation.
Studies on regional differences in international airlines operating economics have been conducted to assist States in the assessment of the impact of regulatory change, support environmental planning, assess the effectiveness of measures for the implementation of the Strategic Objectives and support prorating of passenger revenues from interline journeys.
Research is undertaken and guidance to States provided as required on cost/benefit analysis and business cases for planning and implementation of air navigation systems and related systems (including CNS/ATM). Specific economic studies are conducted, as requested. For example, a study was published in 2011 to assess the present and future demand of civilian licensed aviation personnel and the corresponding training facilities and capacities at global and regional levels. The study aims at estimating if shortages or surpluses are likely to occur over the next twenty years. Formerly, methodological guidelines have been developed to assist States in assessing the economic contribution of civil aviation as a business sector within a given regional/ local or national economy in terms of output and employment.
ICAO’s objective in the fields of forecasting, economic planning and analysis is to support commercial air transport developments, in particular, planning issues related to airports, airlines and satellite-based air navigation systems and services. Such forecasts are critical to effectively implement ICAO’s No Country Left Behind (NCLB) initiative, estimate future trends of noise, emissions and particulate matter, assess the operational and cost-effectiveness of air navigation systems including the Aviation System Block Upgrades (ASBU), and assess licensed personnel and training requirements, as well as for the infrastructure planning and capacity building for improved safety of operations.
This is accomplished through:
Medium and long-term forecasts of air traffic and other planning parameters at global, regional and route-group levels;
ICAO’s strategy for regional traffic forecasting activity meets the demand for specific longrange forecasts in connection with reducing airport and airspace congestion. Direct technical support to regional traffic forecasting groups is rendered in the region of Asia/Pacific (APA TFG) since 1991, and in the regions of Carribean/South-America (CAR/SAM TFG), Africa (AFI TFG) and the Middle East (MIR TFG) since 1998;
Monitoring global and regional air transport developments and specific studies on financial analysis issues of air carrier operations; and
Other economic studies as required.
This Programme also provides services, guidance and technical support for economic matters related to air navigation capacity and efficiency and to aviation environmental matters.