IATA charts volatility differentiation in emerging and developed aviation markets

IATA’s most recent economics chart notes that periods of volatility are not unusual in emerging aviation markets. Globally, aviation markets differ in terms of maturity and development, with a range of factors contributing to the way an aviation market grows or declines.


  • New IATA chart shows more market volatility in countries with emerging aviation systems.
  • China, though still technically a ‘developing’ market, has the lowest volatility of all regions.
  • In general, periods of instability and uncertainty are not unusual in emerging markets.

A range of factors, including the state of a country’s economy, tourism development and geopolitical condition, all contribute to passenger travel demand and how volatile this demand is. Mature aviation markets are generally thought to be more resistant to volatile effects, whereas the immaturity of other aviation markets leads to more susceptibility.

IATA’s graph illustrates this, with the majority of developed markets falling to the bottom left, which represents a lower passenger growth rate but lower volatility:

GRAPH – Volatility vs pax growth in developed and emerging markets

There has been a wide range in performance from country to country, which reflects the differing stages of maturity and characteristics of passenger markets. Nonetheless, the key point is that passenger growth in emerging markets, shaded blue, has typically been faster but more volatile than in developed markets.

A few countries stand out, notably China – which is still technically a developing aviation market. Despite having experienced passenger growth averaging more than 10% each year over the past decade, China also boasts the lowest volatility of all the countries in the chart. This is rather unexpected for a developing market, however according to IATA, it partly reflects the strong state involvement in the industry in that country.

Passenger demand in Vietnam has grown even faster than in China, but has still been less volatile than expected when measured against the general trend line. At the other extreme, Iran has experienced the unwelcome combination of comparatively slow but also volatile passenger growth, driven in part by the impact of international sanctions.

Other countries with a lower volatility, according to the scale, include Germany, Canada, France, Australia, Switzerland and the UAE. The world’s biggest aviation market, the USA, is the only developed aviation market below the volatility trend line, with average growth of less than 2% over the past decade.

The chart also puts the current period of turmoil facing air passenger demand in Turkey into context. While Turkey has grown strongly over the past decade, its position above the trend line indicates that demand growth has been more volatile than expected. This stems in large part from the turbulence of 2016, including the impact of the failed coup, the terror attacks, and the deterioration in diplomatic ties with Russia – which is Turkey’s largest source market for international visitor arrivals.

In general, the chart illustrates that periods of instability and uncertainty are not unusual in emerging markets, with developed economies and aviation markets commonly having lower passenger growth but lower volatility.