Outlook for Air Transport to the Year 2025 - FILT CGIL Foggia

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Chapter 3WORLD ECONOMIC ENVIRONMENTHISTORICAL TRENDS1. As indicated in Chapter 2, the world economy is subject to economic cycles but has steadily grown overthe long term. During the period 1960–2005, the aggregate world economy measured in terms of GDP increasedat an average annual rate of 3.9 per cent in real terms.2. Following the slowdown of 1980–1982, the world economy experienced its longest period of sustainedprogress (1983–1990) since the Second World War, achieving an average annual growth rate of 4.0 per cent before aslowdown in 1991, due primarily to fuel price increases in the wake of the Gulf crisis.3. However, the 1990 oil price increases did less damage to the world economy than did previous increasesin 1973 and 1980. The 1990 increases were smaller, and the ability of the economies of the industrializedcountries to cope with them was greater because of reduced energy dependency and the effects of structuralreforms in the 1980s. They also lasted for a shorter period, with both crude oil and jet fuel prices returning topre-crisis levels by March 1991.4. World economic growth, measured in terms of real GDP, declined from 3.8 per cent in 1989 to 3.0 per centin 1990. In 1991, some major economies entered into a recession or experienced a slowdown; as a result, the worldeconomy increased only by 1.7 per cent in 1991, the most difficult year globally since 1982. The world economyimproved in 1992 and 1993, and over the period 1990–1995 it grew at an average annual rate of 2.5 per cent. Havingexperienced high growth rates in 1996 and 1997 (4.1 and 4.2 per cent, respectively), the world economy sloweddown in 1998, led by a downturn in the Asia/Pacific region, and increased only by 2.8 per cent. It regained strength,however, in 1999 with GDP growth of 3.7 per cent, based mainly on economic recovery in the Asia/Pacific regionand continued strong growth in the United States economy, and continued to grow in 2000 at 4.9 per cent. Anotherslowdown occurred during 2001 across almost all major regions resulting from a marked decline in trade growth,significantly lower commodity prices, and deteriorating financing conditions in emerging markets. The events of11 September 2001 amplified the impact of an already weakening global economy, particularly on consumer andbusiness confidence in the United States; as a result, GDP growth dropped to 2.6 per cent. With trade, industrialproduction and private consumption improving across all regions, the world economy recovered its strength andgrew at a rate of 3.1 per cent and 4.1 per cent in 2002 and 2003, respectively. The growth momentum continued in2004 and 2005, with increases of 5.3 and 4.9 per cent respectively, helped in part by a robust service sectorperformance despite the sustained increase in oil prices.5. World population between 1985 and 2005 increased at an average annual rate of 1.5 per cent. Hence, theworld’s GDP per capita increased during the same period at an average annual rate of 2.2 per cent, lower than thegrowth of GDP itself. For the period 1995–2005, GDP and GDP per capita grew at an average annual rate of4.0 per cent and 2.7 per cent, respectively.6. Figure 3-1 portrays the historical growth trends of GDP and GDP per capita in real terms from 1985–2005and shows that since the end of the economic slowdown of the early nineties, GDP per capita has been growing.22
Chapter 3. World Economic Environment 236GDPGDP per capita4Per cent201985 87 89 91 93 95 97 99 2001 2003 2005Source: ICAO estimates based on data from IMF, World Bank and other sources.Figure 3-1. Growth of real GDP and GDP per capita — World (1985–2005)OUTLOOK7. Despite some concerns about the short-term prospects for some regions and expectations that oil priceswill likely remain at their current levels, there appears to be consensus among economic forecasters that theglobal economy will continue to expand over the medium and long terms. The world GDP growth in 2006 isestimated at 5.1 per cent in real terms and it is anticipated to continue in 2007 and 2008 at the rates of 4.9 and4.8 per cent, respectively.8. Over the long-term horizon to 2025, the world economy is projected to grow at an average annual rate of3.5 per cent in real terms (see Chapter 5). This projected growth rate is slightly lower than the actual rate for thepast 20 years. The economies of the Asia/Pacific region are expected to grow at an average of 4 per cent perannum. Excluding Japan, the region is anticipated to register the highest growth of 5.7 per cent per annum mainlydriven by the economies of China and India whose share in the world economy is expected to double by 2025 dueto an expanding middle class and the growth in export-oriented industries and services. The economies of theAfrican and the Latin America and Caribbean regions are expected to grow at about 5 per cent and 4 per cent perannum, respectively, benefiting from the implementation of reforms aiming at achieving improved fiscal balances,establishing a more effective institutional framework and an increased integration with the world economythrough trade and investment. The economies of the Middle East region are expected to grow at about 4.2 percent per annum, helped by oil exports, economic reforms and diversification. The more mature economies of theNorth American and European regions are expected to grow at about 3 per cent and 2.5 per cent per annumrespectively._____________________
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