The air transport industry is bullish on the untapped prospects of the Southeast Asian market, which is set to be among the fastest-growing regions in the world.

Speaking at Routes Asia 2024 in Langkawi, Malaysia, ACI Asia-Pacific and Middle East Director General Stefano Baronci said Indonesia is expected to rise up the ranks of the world's busiest passenger markets to seventh place in 2032, reaching fourth by 2042.

ACI estimates that the Philippines, India, Indonesia and Thailand will top the fastest-growing markets between 2023-42, with CAGR between 6.2%-7.2%. More importantly, Baronci highlighted that there is huge untapped potential in these top three markets. Taking Indonesia as an example, only 0.32% of the 277 million population tends to use air travel.

He called for the liberalization of skies and regulations, which he hopes will further drive connectivity and capacity growth in the region.

Malaysia Aviation Commission COO Raja Azmi Raja Nazuddin added in a separate panel that he sees potential in novel demand coming from Indonesia’s new capital Nusantara in the island of Borneo. The establishment of the new capital is expected to commence in the second half of 2024.

Raja added the capital will also drive the so-called BIMP-EAGA (Brunei Darussalam–Indonesia–Malaysia–Philippines East ASEAN Growth Area) region, covering the underdeveloped region east of the Association of Southeast Asia Nations (ASEAN), such as Borneo island, Indonesian Kalimantan and south Philippines, with Brunei at the center of it all. In total, it has as a capture area of around 80 million potential passengers.

Boeing's Malcom An, senior managing director for global strategic initiatives, said Indonesia has around 500 aircraft in service, but only 6% are new-generation aircraft, opening opportunities for fleet renewal and growth.