Airlines reject new tax to fight global warming

International Air Transport Association chief objects to proposed $10bn levy to help developing countries fight climate change

Dan Milmo in Kuala Lumpur
guardian.co.uk, Monday 8 June 2009 13.33 BST

The airline industry has rejected calls for a compulsory tax on international flights to help the world's poorest countries fight global warming.
The chief executive of the International Air Transport Association, Giovanni Bisignani, said carriers were "absolutely against" another levy in a year that the industry is expected to lose $9bn (£5.65bn).
"We are absolutely against," he said. "We have seen so many taxes that we are fed up. We are serious about what we pay in emissions [taxes] going towards the environment in a serious way."
The world's 50 least developed countries have proposed a levy on all international fares that would raise $10bn a year, increasing the cost of tickets by about 1%. The idea has been raised as the second week in the latest round of UN climate talks gets under way in Bonn, where 192 countries are negotiating an agreement to reduce greenhouse gas emissions.
Speaking at the IATA annual general meeting in Kuala Lumpur, Bisignani said airlines were already heavily committed to tackling climate change. Iata today set a target of carbon-neutral growth in the airline industry by 2020, driven by 1.5% cuts in fuel consumption every year over the next decade. The industry's carbon footprint is also expected to shrink by 7% this year, largely because of the recession, although IATA credits two percentage points of that reduction to efficiency gains such as better air traffic control.
"We are giving the environment a very high priority with a very clear plan," Bisignani said. "We are serious about setting a target in this industry."
IHS Jane's aviation analyst Chris Yates said: "An annual increase in fuel efficiency of 1.5% is cautious and conservative – it's not a particularly fast improvement in efficiency."
Yates added that the 2050 target of a 50% absolute reduction in CO2 was "a goal that the industry would like collectively to aspire to, but much depends on advancements in new technology to achieve that level".
Andy Atkins, executive director of Friends of the Earth, said: "There are massive environmental issues around growth in air travel. This announcement doesn't look like it'll do anything to address the problem."
The airline industry has been heavily criticised for its perceived intransigence over climate change, but carriers believe they have been singled out unfairly. Aviation accounts for less than 2% of global carbon dioxide emissions. However, it often finds itself at the forefront of the environmental debate because of totemic issues such as the expansion of Heathrow airport. It also features heavily in environmental debates because air travel has been one of the fastest-growing emitters of carbon dioxide in recent years.
In Kuala Lumpur, airline executives have been debating the perennially loss-making performance of the industry, with several senior figures arguing that environmental taxes further drain their financial resources and prevent carriers and manufacturers from investing in green technology.
"The airline industry is not being allowed to reinvent itself and make an impact on the environmental issue. We are trying to generate enough surplus to fund development," said Samer Majali, chief executive of Royal Jordanian Airlines, a member of the oneworld alliance whose members include British Airways, Qantas and American Airlines.
Bisignani also reiterated IATA's opposition to including airlines in the European Union's carbon trading scheme, which is due to embrace carriers from 2012 in a move that is expected to increase the cost of flights. The US has threatened to challenge the scheme in the international court of justice because it would breach international aviation agreements.
"Europe knows that this is not legal," said Bisignani, who continues to hold out for a global scheme that is being worked on by the International Civil Aviation Organisation, a United Nations body. However, the pace of the ICAO negotiations has frustrated the British government and has been criticised by ministers.