There is no gainsaying that these are amongst the toughest times the world has faced in recent memory and it will take considerable time and effort on the part of its prominent leaders and institutions before things return to an even keel.

Over the past year or so, ever since the crisis started to brew, the world’s economies have been faced with some of the toughest challenges.

Biggest among these were oil prices that reached historic highs and showed no signs of coming down exerting unbearable pressure on fragile and isolated economies like the Pacific Islands and the soaring prices of commodities and staple foods.

 

The scare served to constrict the entire supply chain because traditional exporters of staples began curbing their exports fearing threats to their own food security, thereby sending prices spiralling through the roof.

The situation in some islands nations like Kiribati became so bleak that the government of Taiwan had to fly in some 200 tonnes of rice on an emergency basis. But in the run-up to the ruin of the world’s financial system, the one most visible industry that suffered the most because of both peak fuel and fears of the impending downturn is civil aviation.

 

Over 25 big and medium fliers have grounded their operations in the past 12 months and several have either announced mergers or have already merged. All-time high fuel costs and falling load factors delivered a double whammy increasing operating costs unsustainably and the nimble ones in the industry had to think up all kinds of strategies to stay in the air.

That being the state of the highly developed aviation markets in the United States and Europe, the plight of thinly spread out, sparsely populated markets where load factors are a problem even in the best of times like here in the Pacific Islands region can only be imagined.   

 

Yet, the aviation industry in the South Pacific showed resilience by actually increasing destinations and flight frequencies in some markets like the Solomon Islands and Papua New Guinea with the introduction of new players of which some flew the newer, smaller mid-range jets contributing to their operational and cost efficiencies. This development, however, was restricted to Melanesian countries and their connections with Australia where it can be argued there had always been a latent demand that had not been met because of a number of factors ranging from the unavailability of the correct aircraft type to scheduling.

 

The other sub-regions of the Pacific Islands, however, have suffered with some of them facing grave threats to the free movement of people and merchandise as the year draws to a close.

Some months back, flights from Tarawa to Christmas Island via Fiji were grounded because the government of Kiribati was not able to cough up the steep charter fee being charged by the operator for the only flight that connected the two extremes of the atoll nation that sprawls across three time zones in the central Pacific Ocean.

 

The problem languished for several months with no solution in sight and nothing happened until once again the Taiwan government footed the entire bill and paid an advance to keep flights operating until the first quarter of next year. The bill is said to have been close to A$3 million. One can only wonder what will happen when the amount advanced runs out.

 

Last month, another bombshell announcement that flights connecting Auckland, Tonga, Samoa and the United States would be grounded unless the governments of those islands nations were able to come up with a subsidy to keep the planes flying.

 

This has expectedly come as a shock to the concerned islands governments that have been in a series of talks with a range of airline operators for alternative solutions.

 

The development threatens a sizeable volume of marine exports destined for the United States besides inconveniencing a growing volume of passenger traffic.

But this particular instance presents a unique problem because of the distances between the destinations that can be bridged only by large, wide-bodied aircraft. Peeved leaders and aid organisations have accused the incumbent operator, Air New Zealand, and the New Zealand government (the airline’s largest shareholder) of callousness.

 

But in these difficult times when the airline has already announced job cuts, it is understandable for altruism to be a rare virtue especially for a commercial organisation that is facing rough weather.

Unfortunately, this has bred a climate of distrust between airline operators and islands governments, with some islands leaders pointing to the precedent of aid bailouts as being the reason for commercial airlines demanding subsidies.

Their contention is that airlines know that if push comes to shove, the islands nations will have no option but to approach wealthy donor nations to come up with amounts for subsidies as happened in the case of Kiribati.

 

While that accusation may be unfair and a sign of desperation, there is no doubt the aviation industry is facing one of its toughest ever years with no end to the turbulence in sight despite falling oil prices as the financial crisis unfolded. In fact, the fall in prices will be more than cancelled out by a steep downturn in traffic and corporates cut down on their operations and people lose jobs and cut discretionary spending like leisure travel. Which, once again brings the islands region to a problem it has never really tackled in over 30 years: a robust solution to the multifarious and difficult problems of regional aviation. Despite decade-long deliberations that has finally led to a regional air services agreement like PIASA, it still remains to be fully ratified by all Pacific Islands Forum members.

 

It is indeed the Pacific Islands' leadership and the aviation industry operating in the region that must ultimately take the blame for this state of affairs. Repeatedly pointing the cause of the region’s aviation problems to the tyranny of distance, thin populations and lack of appropriate equipment is merely stating the obvious—something which has been done all along. If the region has to grow, it needs a concerted effort—and only a steely political will and a spirit of enterprise focused on long-term gain would provide any lasting solutions.