On 1 January 2022, after three years of being the ACI World Governing Board (WGB) Vice Chair, Sheik Aimen bin Ahmed Al Hosni, CEO of Oman Airports Management Company, began his two-year term as Chair. He has sat down with ACI Insights to discuss his time as Vice Chair and his vision for the next two years as Chair.
The COVID-19 pandemic brought an unprecedented disruption to air transport and to the airport industry in particular, resulting in radical declines of traffic and airport revenues. With thousands of aircraft on the ground and airports nearly empty, the achievements of civil aviation in establishing global connectivity and convenient air transportation have been largely put on pause. Hence, the focus of the WGB shifted towards ensuring the economic survival of the industry and safeguarding its interests in the future.
Before the pandemic, the industry has been known for its economic sustainability and resilience: the two-fold business of complementary and synergetic aeronautical and commercial activities used to generate over 50% in EBITDA, about 20% in net profit margins, and between 6% to 8% in return on invested capital (ROIC), testifying to real economic profitability and competitiveness of the sector, on a global scale. Strong financial performance, towards bigger and commercially successful airports, was reflected in the way airport operators were investing in developing new capacity, state-of-the-art facilities mobilizing the newest technologies, improving service quality, and pursuing sustainability agenda, not only by addressing the environmental concerns and the pressures to decarbonize, but also adopting the best social and corporate governance practices.
Unfortunately, the short-term priorities shifted drastically. Many airports in the region, just like elsewhere, had to rely on government financial assistance programs in order to continue their operations. The entire industry’s attention, reflected in ACI WGB priorities, was reoriented towards recovery plans, under the well-known conditions of volatility, uncertainty, unpredictability and total ambiguity. Normal mechanisms and patterns were no longer working: traffic forecasts became irrelevant overnight, travel protocols were changing continuously, and everyone was learning how to navigate the new reality on-the-go.
The introduction of vaccines and the rollout of a global vaccination campaign against COVID-19 brought some clarity as for what needed to be done in the short-run in order to restart the industry. However, the emergence of several variants of concern, most notably Delta and recently Omicron, pushed us again one step back. On the other hand, the combination of vaccination and testing, which translates into vaccination certificates and PCR-test results from an operational standpoint, represents the key ingredients of the new travel protocols under the current circumstances. In this regard, significant attention of the WGB was placed on formulating proper advocacy, together with our airline partners, to convince governments to avoid blanket travel bans, prohibitive travel policies, unsustainable multi-week quarantines, and other heavy-handed policies hampering air travel. These policies implemented by a significant number of governments across the globe, are neither rooted in science, evidence and facts, nor are compatible with common sense. They have not even been endorsed by the World Health Organization (WHO), which has been very vocal in that blanket travel bans will not prevent the international spread, and that they rather place a heavy burden on the lives of people. Consistent with WHO’s recommendations, ACI has been advocating for an evidence-informed and risk-based approach when implementing travel measures, and this is what is still keeping ACI busy.
In conclusion, the priorities of the WGB shifted from its sustainability, investment and infrastructure development, service quality, digital transformation and facilitation, towards survival strategy and the right advocacy activities to safeguard airport operations in the short-term. Nevertheless, we are convinced that we will be back as soon as the pandemic will subside and the governments across the globe will adhere to a set of clear and consistent travel protocols and embark on mutually recognizable interoperable digital solutions.
Every member of the Board has something unique to contribute to this collective governance body. I tend to look at the industry from a multidimensional perspective, recognizing multiple priorities which need to be tackled simultaneously, with proper allocation of resources. Strong economic performance of airports is an important consideration for the industry in the long-term. However, we are optimistic that the industry will generate sufficient funds to invest in the subsequent development of infrastructure and its activities. Additionally, the industry is facing a significant challenge to decarbonize. There are multiple priorities related to social and corporate governance sustainability which we are fully aware of. Additionally, we want airports to embark on digital transformation and to modernize in the broader sense.
During my tenure and with the cooperation of other members, key achievements have been witnessed. Despite the challenges that accompanied the period, we have made progress on several fronts. Collectively, we were able to devise some strategic insights in technology and innovation to tackle one of the toughest hardships the sector has ever gone through in order to create long-term solutions for its sustainability and to foster its digital competitiveness.
Several axes in this aspect were sharply focused on to prepare the sector for the post-pandemic stage such as advancing contactless technologies; strengthening international efforts that prompted and accelerated the adoption of clean energy solutions at airports such as Sustainable Aviation Fuels (SAF); and laying the foundation for a supportive regulatory framework towards net zero carbon emissions.
In addition, and to achieve stability and sustainability of operations, we have always strived to facilitate direct conversation and to be constructive collaborators to build healthy cooperation with governments, shareholders, creditors, and key stakeholders.
Finally, with the experience I accumulated from opening five airports in five years, I have also worked closely with members who manage airport projects under construction to exchange expertise that we believe can bring long-term benefits.
There are several priorities that I would like to accomplish as Chair of the WGB in the next few years. First, together with my WGB colleagues, I would like to identify proper areas of advocacy and stakeholder engagement to ensure that the industry gets back on the same trajectory as it was before the pandemic struck. That is to say, in the ideal scenario, we would like to close all pandemic-related activities and go back to our core priorities of modernizing and developing airport infrastructure and ensuring it is functioning efficiently, sustainably and that it generates value to the widest range of stakeholders—from passengers and freight forwarders to local communities and suppliers. We—the airport industry as a whole—are very committed to ensuring that robust industry performance translates into wider economic and social benefits and fosters development and prosperity. These would be my priorities for the next few years in the WGB Chair capacity.
The ACI World WGB consists of 28 representatives nominated by the regional ACI Boards, plus the Immediate Past Chair of the Board. The number of regional representatives is calculated based on each region’s share of passenger and cargo traffic.
It meets twice a year for strategic discussions on key subjects for airport operators that reflect the concerns and interests of ACI members. They also determine ACI’s worldwide policies, report to the General Assembly, approve the budget, worldwide program of activities, policy statements and participation in the work of other world bodies, among other duties.