December 8 - The International Air Transport Association (IATA) released a study identifying a quantitative link between a country's air cargo connectivity and its participation in global trade.

The study says that a one percent increase in air cargo connectivity was associated with a 6.3 percent increase in a country's total trade. 

"Air cargo is key in supporting the current global trading system. In 2015, airlines transported 52.2 million tonnes of goods, representing about 35 percent of global trade by value. That is equivalent to USD5.6 trillion worth of goods annually, or USD15.3 billion worth of goods every day.

"We now have quantitative evidence of the important link between air cargo connectivity and trade competitiveness. It's in the economic interest for governments to promote and implement policies for the efficient facilitation of air cargo," said Brian Pearce, chief economist at IATA.

The study identified a number of key policy level and practical industry modernisation priorities to improve countries' air cargo connectivity. 

IATA says legislative priorities include the ratification and implementation of the 1999 Montreal Convention to enable countries to adopt e-freight; and the World Trade Organization (WTO) Trade Facilitation Agreement and World Customs Organization (WCO) revised Kyoto Convention to implement smart border solutions that reduce complexity and costs.

The practical industry modernisation priorities include facilitation of electronic processing, through electronic Air Waybills (e-AWB) and e-freight; implementation by governments of "single window" processing - ultimately enabling submission of all regulatory documents for trade via one channel; coordinated border agency procedures to reduce duplicative controls; the implementation of risk management controls at borders to combat illicit activities and facilitate compliant traders; and the implementation of processes to approve release of shipments in advance of their actual arrival.

"Facilitating trade with efficient air cargo processes requires a strong partnership between governments and industry. Governments have the important role of implementing global standards and agreements to facilitate trade and make it possible for airlines to modernise processes. In turn, the industry needs to embrace these opportunities to improve competitiveness and provide customers with enhanced shipping quality, service and better predictability," said Glyn Hughes, global head of cargo, IATA

The study, commissioned by IATA, was conducted by Developing Trade Consultants.