Government policies hold key to carbon-neutral skies

Climate change is a top global priority. And the aviation industry takes its responsibility seriously.

Aviation's licence to grow is contingent on growing sustainably. Ensuring that is of vital interest to the global economy. Three billion passengers and nearly 50 million tonnes of cargo rely on aviation annually. This supports 57 million jobs and US$2.2 trillion of business. In Hong Kong alone, that's HK$133 billion of gross domestic product and 250,000 jobs.

Global connectivity creates possibilities for business, ideas and people to interact and create wealth. It is critical to foster this unique capability with alignment between government and industry to ensure aviation's sustainable growth.

Aviation has ambitious commitments to manage its 2 per cent share of global man-made carbon emissions. These include achieving carbon-neutral growth from 2020 and cutting net emissions in half by 2050 (compared to 2005 levels).

To achieve these commitments, we will need investments in new technology, more efficient operations and infrastructure, and access to global market-based measures. This is the aviation industry's four-pillar strategy on climate change.

The European Union's unilateral plan to include international aviation extraterritorially in its emissions trading scheme (a regional market-based measure) brought us to the brink of a trade war. Last November, the EU "stopped the clock" on implementation. That defused tensions and created the possibility for governments to agree on a global approach through the International Civil Aviation Organisation. In preparation for its assembly later this year, work is progressing in earnest on options for a global approach to market-based measures.