Ensuring regional air connectivity
By ensuring rapid connections over bigger distances, aviation plays an important role in connecting remote areas to the centres of economic activity, hence making them more attractive to economic investment, maintaining populations of those regions, and rebalancing the national economy away from the centre.
With deregulation of the aviation sector over the past two decades, numerous domestic routes have become unsustainable due to their low profitability. In many ITF countries, governments stepped in and launched programmes supporting domestic air connections, many of them significant in terms of both their costs and scope. For example, in the United States the Essential Air Services Program subsidises links to the national aviation system in over 170 communities at a cost of around USD 300 million per year. The Japanese government subsidises airline operations on 14 remote island routes. Norway foresees a budget of EUR 74 million in subsidies to air transport services in 2019. Over 200 routes are supported by Public Service Obligations inside the European Economic Area. In other countries, such as Canada, no support is provided for domestic air connections.
This panel session will gather government officials and independent experts to discuss the following questions:
- What is the role of governments in supporting regional air connectivity?
- What are the costs and benefits of government intervention in the market for regional air connectivity?
- What policies supporting domestic air connectivity are proving cost-effective?
ITF (2018), “Government Support Measures for Domestic Air Connectivity”, https://www.itf-oecd.org/sites/default/files/docs/domestic-air-connectivity_0.pdf