Wednesday, September 21, 2011

Heathrow Lagging Behind Other European Airports

A new report released by Frontier Economics and commissioned by the owner of Heathrow Airport indicates that a lack of direct flights to emerging markets is already costing the UK an estimated 1.2 billion pounds a year as trade goes to better-connected competitors. Additionally, the report emphasizes that British businesses trade 20 times as much with emerging market countries that have direct daily flights to the UK as they do with those countries that do not.

COMMENT: Charles de Gaulle and Frankfurt already service 1,000 more annual flights to the three largest cities in China than Heathrow.

The Conservative-led UK government blocked development of a third runway at Heathrow when it came to power last May and is currently undertaking a review of its national aviation infrastructure plan. London's Mayor, Boris Johnson, is in favor of building a new airport in the Thames estuary instead of expanding Heathrow.

Much like the US, the International Monetary Fund on Tuesday cut its forecast for UK growth to 1.1% from 1.5% this year, and to 1.6% from 2.3% for next year.

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