Despite a robust contribution of ₱5.2 trillion (approximately $93 billion) to the nation’s GDP and the support of 11.2 million jobs in 2024, the Philippine aviation sector risks falling behind regional competitors without coordinated national action. This was the central message delivered by Philippine Airlines (PAL) President Richard Nuttall in his keynote presentation at the 2025 Aviation Summit.
Mr. Nuttall highlighted that the industry successfully handled 16 million passengers in 2024, attributing the strong performance to improved economic conditions, aggressive airline network expansion, competitive airfares, and government efforts in infrastructure and tourism. This progress is essential for the region, which is seeing a 5.3% annual growth rate in the Asia-Pacific aviation market.
However, Nuttall cautioned that the Philippines continues to lag behind its regional neighbors due to persistent issues, including inflationary trends, geopolitical uncertainties, and a critical lack of coordination among stakeholders.
“Without synchronized efforts in infrastructure development, sustainability, and the use of modern technology, the country risks falling further behind,” Nuttall stated, emphasizing that the current capacity limitations of the country’s main airport hamper fleet expansion and that many provincial airports restrict route growth due to size and night-rating issues.
To address these gaps and secure long-term competitiveness, Nuttall outlined a comprehensive strategic blueprint centered on seven key pillars:
National Aviation Infrastructure Blueprint: Urgently prioritizing investment in airport upgrades and the modernization of air traffic management systems. Nuttall expressed hope that major upcoming projects, such as the new Bulacan airport, are built with long-term capacity in mind.
Improved Investment Climate and Policy Stability: Calling for reduced and streamlined aviation fees and incentives for new routes. Nuttall warned that excessive costs—given the tight margins airlines operate on—will be passed on to passengers, making Philippine routes less competitive.
Tourism-Driven Air Connectivity: Ensuring that airport development projects align with tourism investment zones to maximize economic impact and improve connectivity to underserved destinations.
Workforce Development: Addressing the global shortage by encouraging investment in training for Pilots, Mechanics, and Ground Crew. He welcomed the establishment of the National Aviation Academy of the Philippines.
Support for Cargo, MRO, and Aerospace Sectors: Advocating for greater investment in air cargo logistics hubs (like Clark, Cebu, and the future Bulacan airport) and the establishment of local widebody aircraft maintenance, repair, and overhaul (MRO) facilities and aerospace manufacturing to transform the Philippines into a competitive service destination.
Digital Transformation: Pushing for investments in artificial intelligence, biometrics, and smart airport technologies to enhance customer experience and operational efficiency.
Strengthen Governance and Industry Collaboration: Proposing the creation of the Philippine Aviation Competitiveness Council. This dedicated council would oversee government-industry collaboration, monitor performance, and benchmark key metrics—such as on-time performance and cost per passenger—against ASEAN peers.
PAL is already moving forward with its own initiatives, having successfully navigated global supply chain challenges and earned recognition from Cirium for its exemplary on-time performance, demonstrating its commitment to advancing the Philippine aviation sector.
“The opportunities are immense, but time is of the essence,” Nuttall concluded. “By working together and executing a cohesive national strategy, we can transform the Philippines into a true hub for aviation and a competitive destination in the Asia-Pacific region.”
