IATA emphasizes the critical role of air connectivity in economic growth and prosperity. For the Philippines, 8% of international passengers continue their journey on domestic flights, while 86% either conclude their trip at the point of entry or switch to other modes of transport. Additionally, 5% of international arrivals proceed to destinations in other countries.
Air connectivity is fundamental to unlocking economic potential, enabling industries across the country to engage in dynamic business activities. IATA states, “The extent of domestic and international connectivity is an enabler and an accelerator of both the generation and distribution of economic benefits.”
In 2023, international air traffic accounted for 30% of the Philippines’ total origin-destination (O-D) departures, equating to 12.3 million passenger departures.
The Asia Pacific region remains the largest market for international passenger flows from the Philippines, followed by North America and the Middle East. Specifically, 7.9 million passengers traveled to other Asia Pacific countries (65% of the total), 1.7 million to North America (14%), and 1.5 million to the Middle East (12%).
The report highlights two key indicators of air transport’s economic impact: job creation and contribution to gross domestic product (GDP). In the Philippines, the aviation sector directly employs 76,100 people, generating $3.3 billion in economic output, which is 0.8% of the total GDP. The wider supply chain, employee spending, and tourism activities contribute an additional $20.3 billion to GDP and support 1.9 million jobs.
Tourism supported by aviation contributes $11 billion to the country’s GDP and employs 1.3 million people. International tourists are estimated to contribute $11.3 billion annually to the economy through the purchase of goods and services from local businesses.
Air transport also enhances access to education, connects friends and families, facilitates cultural exchange, and drives socio-economic development. These forces collectively expand a country’s productive potential, delivering long-term economic growth and improving living standards.
The cost of flying significantly impacts the benefits generated by air travel. Over the past 50 years, global flight costs have decreased by 70%, making air transport more accessible. In the Philippines, the average real airfare decreased by 29% between 2011 and 2023, with the local population now needing to work 13.5 days to afford a plane ticket. In 2023, there were 352 flights per 1,000 population.
Aviation stimulates global trade and investment, enhances labor and capital productivity, boosts innovation, and fosters knowledge exchange. The movement of goods via air transport improves economic outcomes through collaboration, specialization, and efficient resource allocation across all sectors.
The report underscores aviation’s crucial role in developing dynamic and efficient supply chains and driving e-commerce growth. In times of crisis, air cargo is vital for providing humanitarian aid and emergency relief. In 2023, 830,000 tons of air cargo were transported through Philippine airports, supporting the country’s total import and export volumes.
