Korea braces itself for air cargo boom
13 / 07 / 2011
KOREA looks set to rapidly increase its air cargo traffic over the next decade thanks to new free-trade treaties with the EU and the US.
The treaty with the EU has already been agreed and is expected to generate an extra US$4.7 billion of trade, largely by air, every year for the next 15 years. Meanwhile, the Korean-US agreement is still waiting for final approval. Once approved it will remove 95 per cent of tariffs between the two countries.
Korean Air, which earned 28 per cent of its freight revenue in the first quarter of this year from European routes, compared with 40 per cent from the Americas, said it predicts air cargo exports will increase 6.4 per cent and imports 2.8 per cent due to these new agreements.
This could well give Korean Air the boost it needs to reclaim the crown of the world’s biggest international air cargo company, which it lost to Cathay Pacific Airways last year.
“Korean Air is sure to reclaim its number-one position,” said Song Jae Hak, a transport analyst at Woori Investment & Securities in Seoul (South Korea).