Long-term growth fuels economic outlook
Long-term economic projections for Latin America and the Caribbean remain positive, with IHS Global Insight predicting growth in the region to improve steadily over the near term and, by 2017, to outpace world GDP growth.
Economic growth in Central America remains strong, led by Panama with growth averaging 5.6 percent over the next five years. Meanwhile, five-year average growth rates for Brazil and Mexico—the region's two largest economies—are 3.8 percent and 2.3 percent, respectively. Aviation is a key component of this growth dynamic because it facilitates trade, travel, and tourism, while promoting globalization and technology development. We continue to project strong demand for air travel over the long term for Latin America and the Caribbean.
Airline industry continues to evolve
The past several years have seen significant consolidation, including the mergers of LAN with TAM, Avianca with TACA Airlines, GOL with Webjet, and Azul with TRIP, resulting in larger, more stable, and more competitive airlines. Low-cost carriers are a growing presence in the region, expanding services and bringing affordable air travel to more people and more communities. Further liberalization of air service agreements is providing opportunities to expand networks and stimulate traffic. Implementation of the US-Brazil open-skies agreement will begin during the latter part of 2015. And agreement has been reached to further relax the US-Mexico bilateral arrangement. These developments produce new opportunities for cooperation through partnerships and alliances.