ISSUE OCTOBER 2014 6 ISSN 2304-5043 SPC Economic Development Division | Association of South Pacific Airlines PACIFICAVIATION MAGAZINE THE PACIFIC'S LEADING AVIATION MAGAZINE | No.1 in Circulation and Readershipskies FEATURE AIRLINE: NAURU AIRLINES DOMESTIC AIR SERVICES IN THE PACIFIC THE WIDER BENEFITS OF AVIATION IN THE PACIFIC We’re redefining airline growth Maximize the revenue from every seat sold Travelport’s Merchandising Platform transforms the way you deliver, differentiate and retail your brand to over 67,000 travel agency customers globally. Our award-winning and industry-leading technology, encompassing Rich Content and Branding, Aggregated Shopping and Ancillary Services, is designed to maximize the revenue you can generate from every seat sold. Discover how our platform can help grow your business. Please contact [email protected] for more information. © 2014 Travelport. All rights reserved travelport.com ISSUE OCTOBER 2014 6 ISSN 2304-5043 PACIFICAVIATION MAGAZINE skies FRONT COVER: Nauru Airlines recently took delivery of a B737–300 Freighter Aircraft See cover story for more information 13 18 22 46 Contents 04 MESSAGE FROM THE EXECUTIVES 26 PACIFIC AVIATION NEWS Message from Director SPC Economic Development Division 32 PACIFIC AVIATION SAFETY OFFICE UPDATE Message from Secretary-General Association of South Pacific Airlines 34 SPC ECONOMIC DEVELOPMENT DIVISION The wider benefits of aviation in the Pacific 08 ASSOCIATION OF SOUTH PACIFIC AIRLINES 36 PETROLEUM Airlines and industry partners meet for the 60th Asian jet fuel prices: October 2013 to July 2014 general session of the Association of South Pacific Airlines 38 AIRWAYS NEW ZEALAND Airways New Zealand leads aviation projects 10 SPC ECONOMIC DEVELOPMENT DIVISION in the Pacific We’re Domestic air services in the Pacific 41 TRAVELPORT 13 KIM MURRAY – AVIATION LAW The rise and rise of ancillary revenue Harmonising Pacific aviation law 46 PAPUA NEW GUINEA – FEATURE AIRLINE 18 NATIONAL AIRPORTS CORPORATION Feature Airline: Nauru Airlines redefining Civil Aviation Development Investment Program 22 INTERNATIONAL AIR TRANSPORT airline growth ASSOCIATION Montreal Convention 1999: A universal airline liability regime for a global industry Maximize the revenue from every seat sold Have you got any stories or photos that you want to share regarding aviation in the Pacific Travelport’s Merchandising Platform transforms the way you deliver, Please send us an email to [email protected] differentiate and retail your brand to over 67,000 travel agency customers globally. Our award-winning and industry-leading technology, encompassing Rich Content and Branding, Aggregated Shopping and Ancillary Services, © Copyright SPC / ASPA 2014 For more information, contact: Secretariat of the Pacific Community is designed to maximize the revenue you can generate from every seat sold. 2nd Floor, Lotus Building, Nabua | Private Mail Bag, Suva, Fiji Parts of this document may Tel: +679 337 0733 Fax: +679 337 0146 | Email: [email protected] be reproduced, provided Website: http://www.spc.int/edd Discover how our platform can help grow your business. acknowledgement is made to this publication and SPC and ASPA as Disclaimer: All care and diligence has been used in extracting, analysing and Please contact [email protected] for more information. source. compiling this information, however, SPC and ASPA gives no warranty that the information provided is without error. Cover photo by: Nauru Airlines © 2014 Travelport. All rights reserved travelport.com Layout & Design: Jale Solivakanene Prepared by the Economic Development Division Secretariat of the Pacific Community SPC ECONOMIC DEVELOPMENT DIVISION Message from Director, SPC Economic Development Division Welcome to another edition of Pacific Skies. This edition contains a range of topics of relevance to aviation in the Pacific, including domestic air services, harmonising aviation law, airline liability, the work of the Pacific Aviation Safety Office, the social benefits of aviation, new aircraft acquisitions, fuel John Hogan Director prices, and the rise in the use of ancillary services by airlines. SPC Economic Development Division e have also introduced a While enhancing the frequency of feature article on airlines flights in the region is good for the W operating in the region, region’s tourism and business sectors, with Nauru Airlines being the focus of the increased activity can also come this edition of Pacific Skies. at a cost. Passengers are well aware of the need to undertake relevant aviation As with all our previous editions, security screening when undertaking "In order special thanks are extended to those a flight anywhere in the world, and to ensure who have contributed articles and other the cost of those measures, in terms the industry material that make this magazine an of increased ticket prices and longer continues increasingly anticipated read every six processing times, are well known. But to grow and months. And of course our thanks also one of the costs of increased travel go to our advertisers, whose support operate in a and freight volumes is the risk of safe and secure enables Pacific Skies to continue to be exposure to an increasing number of environment, published for the benefit of the aviation existing pests and emerging diseases community in the Pacific. that have the potential to be a threat the aviation to Pacific economies, especially with sector needs to You will note from the Pacific respect to agriculture production. be supported Aviation News and others sections of Accordingly, there is a need to ensure by ongoing the magazine that the last six months that effective bio-security measures and have been a busy time in terms of maintenance risk management processes are in place airlines receiving new or replacement of essential at airports to reduce the likelihood of aircraft – and there are more deliveries infrastructure potentially harmful pests and diseases on the horizon. This signals increased and sufficient entering a country. While the direct confidence by governments and the investment in costs to government from implementing private sector in the ongoing viability an effective biosecurity regime may airport and of the aviation industry in the region. be high, the cost of not having such a navigational However, in order to ensure the industry regime in place could be devastating facilities." continues to grow and operate in a safe to countries in the region. So the next and secure environment, the aviation time baggage or cargo is checked at sector needs to be supported by ongoing an airport by bio-security officers, it maintenance of essential infrastructure is important to remember that such and sufficient investment in airport and measures are being undertaken to protect navigational facilities. Such investment a country’s people and its economy. should be a priority, if the aviation sector is to continue to be a key facilitator of I hope you enjoy the sixth edition economic development in the region. of Pacific Skies. 4 PACIFIC SKIES MAGAZINE ■ Issue 6 ■ 2014 ASSOCIATION OF SOUTH PACIFIC AIRLINES Message from ASPA Upskilling local managers Greetings from the Secretariat of the Association of South Pacific Airlines (ASPA). f you are a regular reader of not necessarily directly concerned Pacific Skies, you will be familiar with training but could impede the I by now with ASPA’s passion for ability of managers to implement George Faktaufon training local airline managers: it has newly learned knowledge in the work Secretary-General been a top priority since1996. We place. Such issues can involve internal Airlines conduct training on a regional basis as systems and procedures and even Association of South Pacific it is more economical to do it this way; policies and work practices. many airlines do not have the numbers This has come to light during to justify in-house training. It also discussions with the course participants allows local managers and potential and our own observations. Many of managers from different airlines to them expressed concern that they network and learn from each other. "The Secretariat might not be able to put into practice continually what they had learned because their The first ASPA Management Skills monitors and Training Programme was developed by internal systems and procedures do evaluates the a human resource development (HRD) not allow them to introduce new ideas. consultant, GV Killen and Associates, Some felt strongly that their bosses effectiveness in 1996. The programme was based on needed to attend the same courses so of the training a set of criteria agreed on by the ASPA that they would all speak the same to ensure that HRD Working Group, and was tendered language. These remarks were made the airlines are out to the International Air Transport by the participants who attended both benefiting and Association and several international the management skills training between also to highlight training organisations, including some 1996 and 2006, as well as the current any issues that universities. The programme ran twice management training programme. the airlines yearly from 1996 to 2006, and 496 local Their comments were relayed to the need to address airline CEOs for consideration and airline management staff went through internally." it. During the 11 years, the programme necessary action. was regularly updated to keep up These issues came as no surprise. with the latest trends in management In my 40+ years in the airline industry, development. It was discontinued in I have noticed that there has been 2006 and, in 2007, ASPA redirected its very little effort put in by individual management training towards quality, airlines to train and develop local safety/security, risk management and managers on a regular basis. There auditing. This training was mainly is one exception, Air Vanuatu, which focused on managing the processes I describe later. that achieve desired outcomes. The Secretariat continually monitors and Most airlines promote employees evaluates the effectiveness of the into management positions because of training to ensure that the airlines their technical competence.