Air Arabia's boss sees a "much better" second half of 2021 for air travel before a return to normality by 2022, he said on Tuesday.
The low-cost airline anticipates a "good boom" in business for the aviation industry once countries lift travel restrictions and airports simplify procedures, Adel Ali, Air Arabia's chief executive, said in an interview with aviation consultant John Strickland at an online event organised by Arabian Travel Market on Tuesday.
"I hope airports over the world will not over-engineer it and make it over-complex, the way they did post-9/11," he said. "I'm hoping that the second half of this year will be a much better half and 2022 will be more getting into normality."
The Covid-19 pandemic has hit the aviation sector particularly hard, but demand is beginning to recover in fits and starts due to the increased pace of the vaccine distribution in many countries across the world.
Air Arabia Abu Dhabi, a joint venture between Etihad Airways and Air Arabia that launched in July 2020 during the pandemic, is "doing relatively well under the circumstances" Mr Ali said.
"I'm confident about the fact that once we go post-Covid we see a very good potential in the Abu Dhabi hub and it will grow very well, the CEO said. "It's a good thing for Air Arabia, for Etihad and for Abu Dhabi as well."
Air Arabia, the UAE's only listed airline, operates five hubs in Sharjah, Ras Al Khaimah, Abu Dhabi, Egypt and Morocco.
Air Arabia Abu Dhabi competes in the UAE capital with another new entrant into the market Wizz Air Abu Dhabi, a joint venture between Hungarian low-cost carrier Wizz Air and Abu Dhabi state holding company ADQ.
"The market is sizeable," Mr Ali said. "I hope they will be able to create their own niche and we will be doing our own niche."
Wizz Air Abu Dhabi currently serves 23 routes in 15 countries from its hub at Abu Dhabi International Airport and plans to expand its operations after the emirate announced new Covid-19 quarantine-free travel rules from July.
Air Arabia still intends to take delivery of its order of 120 Airbus A320 family jets – including 20 of the ultra-long range A321XLR planes – which are due for delivery in 2024, Mr Ali said.
"Every indication says that the market will fully go back to 2019 levels around 2024, so hopefully if all those predictions are correct, then we will be in the right position to take delivery at the time," he said.
Carriers around the world have been negotiating with planemakers to defer upcoming deliveries of their aircraft in a bid to conserve cash during the Covid-19 pandemic that has paralysed travel demand and withered revenue.
Air Arabia's boss said he hopes that Belarus' deployment of a fighter jet to divert a Ryanair flight and arrest an opposition journalist is a "one-off" individual incident and will not impact how the industry is regulated.
The incident will be dealt with by the governments of the states involved, Mr Ali said.
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
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- Have a plan for your savings.
- Decide on your emergency fund target and once that's achieved, assign your savings to another financial goal such as saving for a house or investing for retirement.
- Decide on a financial goal that is important to you and put your savings to work for you.
- It's important to have a purpose for your savings as it helps to keep you motivated to continue while also reducing the temptation to spend your savings.
- Carol Glynn, founder of Conscious Finance Coaching
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- Individuals must register on UAE Drone app or website using their UAE Pass
- Add all their personal details, including name, nationality, passport number, Emiratis ID, email and phone number
- Upload the training certificate from a centre accredited by the GCAA
- Submit their request
What are the regulations?
- Fly it within visual line of sight
- Never over populated areas
- Ensure maximum flying height of 400 feet (122 metres) above ground level is not crossed
- Users must avoid flying over restricted areas listed on the UAE Drone app
- Only fly the drone during the day, and never at night
- Should have a live feed of the drone flight
- Drones must weigh 5 kg or less
Tamkeen's offering
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- Option 2: 50% across three years
- Option 3: 30% across five years
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