The value of regional connectivity

Dr Irwin Stelzer – Senior Fellow, Hudson Institute, Washington D.C. and Sunday Times columnist is to give a keynote address in Newcastle following publication of ‘Connecting for Growth’ a report by Oxford Economics in 2011, representing Heathrow Airport.

The report claims that Britain “risks being cut off from global growth” and becoming “a less competitive place to do business” because it is losing out to European competitors in the battle for flights to emerging markets. A lack of direct flights to emerging markets may already be costing the UK £1.2bn a year as trade goes to better-connected competitors. This figure could rise to £1.6bn by 2021 - equivalent to one-third of the UK’s current balance of trade deficit.

The report establishes a direct relationship between frequent direct air connections and improved volumes of trade and investment. It finds that UK businesses trade 20 times as much with emerging market countries that have a direct daily flight to the UK as they do with those countries that do not.

However, the report warns that only a major transfer hub is able to serve such destinations, and because the UK’s hub airport at Heathrow is full, Britain is missing out on opportunities for trade and falling behind European competitors.

NECC is organising the event to underline the need for strong regional airports as well as a strong national hub airport. Further recent research will illustrate the enormous impact that airports have in terms of increasing international trade which are strongly related to economic growth.

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