IATA Bounce Big Beat Of 2010

(Geneva Exclusive)—There are all kinds of bounces in the world we live in.
     The Business-Man’s Bounce refers to that peculiar type of ballroom dancing that is seen at fancy dress banquet dinners and weddings as men who might prefer to be anywhere else twirl about the floor biting their lower lip.
     In sports a “Jersey Bounce,” is the way a ball moves unexpectedly or ricochets off a wall.
     In air cargo “The Bounce,” according to IATA Head of Cargo Aleks Popovich is “Bounce Back 2010” at the huge industry meet & greet and maybe learn something Fourth Annual World Cargo Symposium Expo being held in Vancouver, Canada early next year.
     Air cargo stakeholders around the planet will get the chance to measure just how big (or small) a bounce can be expected as everyone struggles back from the worst couple of air cargo seasons that anyone can remember.
     “Vancouver will be the biggest and best business based air cargo event of 2010,” Aleks Popovich IATA Head of Cargo told Air Cargo News/Flying Typers.
     “Our Fourth Annual World Cargo Symposium (WCS) “Bounce Back: Rebuild for the Future! Is being held March 08 - March 11, 2010 in Vancouver, Canada at The Westin Bayshore.
     “This World Cargo Symposium will continue the tradition established by our first three events— Mexico City, Rome and this year (2009) in Bangkok, of delivering the most unique air cargo event that is tasked with moving from talk to action.
     “WCS IV Vancouver is themed on what it will take for the air cargo supply chain to bounce back from the current recession and rebuild its future.
     “The event is designed for all audiences
     “We know that economic uncertainty prevails, together with increased safety, security, and environmental demands.
     “WCS will focus on deep dish sessions meant to flesh out time lines and economic scenarios that air cargo faces and how best to respond?
     “World Cargo Symposium IV will also reveal scenarios of how the air cargo supply chain can bounce back from the current recession and deliver a step change in efficiency and customer value.
     “WCS will tackle how air cargo supply chains should respond to the increasing safety, security, and environmental regulatory demands.
     “Our mission is to bring to the fore topics of unique common interest amongst transportation professionals—not adequately addressed elsewhere.”
     Aleks Popovich has been all about world air cargo change since he moved over from the airline side to IATA four years ago.
     Although he has an enormous task with new wrinkles every day he remains quiet spoken and determined.
     He recalls the initial thing he did after joining the governing body that creates regulation for international air transport.
     “After I was given an office here, I sat down, looked at the desk and telephone, then decided to go take a coffee.”
     That was April 2005 in Geneva, after Mr. Popovich departed British Airways, moving to IATA where he accepted the challenge of addressing a broad agenda including immediately formulating a plan of action.
     From the sound and look of things, even before that coffee kicked in, Aleks was on his way.
     His first move was to gather support for air cargo and to adopt the IATA passenger-driven paperless initiative and general overall mission statement to simplify process.
     Now with a shopping list of industry centric projects seeming all going on at once including e-freight, Cargo 2000, CNS, CASS and a host of other activities—centerpiece to all of this has been the master stroke of taking a mostly clandestine IATA annual gathering and morphing it into some thing completely different as the most important yearly cargo industry gathering.
     “Our view is that World Cargo Symposium will work if only to bring forward to people in this industry some best practices—hands on practical solutions toward being able to make the critical decisions to ensure we are fit for business.”
     To look at studious Aleks Popovich, who could have guessed in 2009, he would emerge as the king of take-away?
     “This is a time in air cargo history when we all need to share ideas and deliver value for money every step of the way.
     “So we are tasked to both report to the air cargo industry of the successes and also where we have come up short on promises made at our previous World Cargo Symposiums.
     “Clearly what the delegate takes away from our event is of prime concern to all of us at IATA.”
     Little doubt from the outside looking in that World Cargo Symposium Number IV, in Vancouver, Canada during the first week of March 2010 is the most important industry gathering of the year and probably in several years, given the kind of business air cargo is experiencing in 2009.
     “WCS hit its stride and made big gains coming out of its third meeting in Bangkok earlier this year,” Aleks said.
     The value of IATA events cannot be underestimated although just like every public attempt at change or even gathering, IATA has its critics.
     But our view is that if you can’t do better then start applauding this truly stellar effort.
     When this business needs it most, Aleks Popovich as Head of Cargo at IATA is, with the help of his worldwide team, coming up big for air cargo.
     More power to them, and us, we say.
Geoffrey

     In the past two years, Asia's junior tiger has been wrestling with a number of problems. After run-away inflation in 2008 and a slump in growth in the first half of 2009, stabilization now seems to be around the corner, though.      Nonetheless, challenges remain - especially on the fiscal front - and they are structural in nature. If Vietnam succeeds in addressing these challenges, its positive medium-term outlook will be enhanced.
     Vietnam can look back on two turbulent years. Up until mid-2008, run-away inflation was the main concern. From the end of 2008 it became clear that Vietnam was also going to be hurt by the global economic crisis. However, current data still suggest relatively robust growth for this year – even though, at 4% yoy, real GDP growth will be considerably lower than the average for the last five years. As a result of the global recession, inflation rates have also come down substantially – to 3.3% yoy in July. Nonetheless, a number of challenges remain.
     Both the budget and the current account have been in deficit for years now. Despite the fact that these deficits are in part the result of structurally necessary, medium-term investments they do give rise to economic vulnerability and raise questions of financial sustainability.
     The Vietnamese government has launched an ambitious economic stimulus package worth 8% of GDP. Whether this can be fully financed, is still questionable, though. Against the backdrop of persistently rising government debt, the structural budget deficit and volatile revenues, the Fitch rating agency downgraded Vietnam's long-term local currency rating to BB in June. Measures to support business activity could also rekindle inflation as credit growth has picked up again noticeably on the back of interest subsidies. Moreover, rising numbers of loan defaults are to be expected. The central bank has therefore instructed the banks to tighten lending again.
     External liquidity is one of Vietnam’s weaknesses. FX reserves in "hard" currency are relatively low, amounting to a mere USD 24 bn in 2008.
     Estimates for May 2009 factor in another drop to roughly USD 20 bn.
     External financing requirements – calculated as the sum of the current account deficit, short-term external debt and long-term foreign liabilities falling due – stand at over 80% of available reserves, representing quite a challenge. FDI inflows have already dropped sharply, by nearly 80% yoy in the first half of 2009.
     While lower investment – and thus also imports – and declining commodity prices are helping to narrow the trade deficit, weaker demand in the industrial countries will hurt Vietnam’s export business. However, the relatively low degree of concentration on a few export goods and markets is a good thing. Vietnam’s main export items are crude oil, textiles and shoes. In 2008, they accounted for nearly 40% of total exports, with the share of crude oil exports having declined steadily for a number of years now. Agricultural produce, mostly rice and coffee, together with seafood account for just under 20%. With a 19% share, the U.S, is the country's main export market, followed closely by the EU, ASEAN and
Japan. Due to a lack of refinery capacity, fuel imports account for almost 14% of total imports. Other important import goods are machinery and steel, as well as inputs for the textile industry.
     The crisis highlights the necessity and offers the opportunity to tackle structural problems. The most important issues are boosting competitiveness and improving the environment for investment. In a survey of Japanese companies, more than 16% considered high and rising wage costs to be a risk; this was nearly double the figure registered a year earlier.
     Also, the World Economic Forum's current "Global Competitiveness Index" ranks Vietnam 69th out of a total of 130 countries. Corruption, bureaucracy and legal certainty are areas in need of improvement, especially compared with other countries in the region.
     In its recently released "Corruption Perception Index", Transparency International puts Vietnam in 121st place. In Southeast Asia, only Indonesia and the Philippines have worse rankings. According to the World Bank, it takes an average of 50 days to start up a business in Vietnam. This is considerably longer than in other emerging markets.
     Despite all these short-term challenges, though, Vietnam's positive medium-term growth outlook still rests on a sound footing. This includes its young and relatively well-trained population, which promises to yield a positive demographic dividend. Moreover, the investments made over the last five years will lead to productivity increases and reduce supply-side bottlenecks. The government remains committed to opening up and reforming the economy and intends to continue privatizing state-owned companies. Also, more investment projects are to be implemented as private-public partnerships. This will likely continue to provide growth opportunities for Vietnam on a medium and long-term horizon.

     Air Cargo News FlyingTypers leads the way again as the world’s first air cargo publication to connect the industry to the broadly expanding and interactive base for social commentary—Twitter.
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