The world's airlines are expected to suffer a net loss of US$5.6 billion in 2010, larger than the previously forecast loss of US$3.8 billion, the International Air Transport Association (IATA) said on Tuesday.

In its latest financial outlook, the industry group also maintained a forecast net loss of US$11 billion in 2009.

"Between 2000 and 2009, airlines lost US$49.1 billion, which is an average of 5 billion dollars per year," said Giovanni Bisignani, IATA's director general and CEO.

"The worst is likely behind us. For 2010, some key statistics are moving in the right direction. Demand will likely continue to improve and airlines are expected to drive down non-fuel unit costs by 1.3 percent," Bisignani said in a statement.

"But fuel costs are rising and yields are a continuing disaster. Airlines will remain firmly in the red in 2010 with US$5.6 billion in losses," he added.

According to the IATA outlook, following a decline of 4.1 percent in 2009, world passenger traffic is expected to grow by 4.5 percent in 2010 (stronger than the September forecast of 3.2 percent). A total of 2.28 billion people are expected to fly in 2010, bringing total passenger numbers back in line with the peak recorded in 2007.

Cargo demand is expected to grow by 7 percent to 37.7 million tonnes in 2010 (stronger than the previously forecast 5 percent), following a 13 percent decline in 2009.

"The number of travelers will be back to the peak levels of 2007, but with US$30 billion less in revenues ... there is no recovery in sight for 2010. Tough times continue," said Bisignani.

North American carriers will see losses reduced from US$2.9 billion in 2009 to US$2 billion in 2010. The relative improvement is largely the result of pricing power and cost reductions gained through capacity adjustments.

European carriers will generate the largest losses of any region, at 2.5 billion dollars. But this is an improvement over the 3.5 billion-dollar loss that the region's carriers are expected to post in 2009. Slow economic recovery in the region combined with limited ability to adjust capacity due to airport slot regulations is hindering the region's airlines.

Asia-Pacific carriers will post losses of US$700 million. Compared to losses of US$3.4 billion in 2009, this region is showing the most dramatic improvement. This is driven by a recovery in some of the region's economies, particularly China.

Latin American carriers will be the only profitable regional grouping in both 2009 and 2010. The profit in each year is expected to be 100 million dollars. This is largely due to the benefit of relatively strong economies in South America and the efficiencies gained through regional airline structures.

Middle East carriers will see losses shrink from a US$1.2 billion in 2009 to a 300 million dollars in 2010, while African carriers will deliver a loss of 100 million dollars in 2010 -- consistent with the loss for 2009.

(Xinhua News Agency December 16, 2009)