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DIFC Seeking To Support Aircraft Leasing Boom

by Lorys Charalambous, Lowtax.net, Cyprus
15 November, 2017

Dubai International Financial Centre, the low-tax international financial center, says it is well positioned to support an expected boom in demand for aviation finance.

According to the International Air Transport Association, global passenger volume is forecast to double over the next 20 years, led by a surge in air travel in the Asia-Pacific region. Four billion passengers are expected to fly in 2017, increasing to 7.8 billion passengers in 2037.

This strong demand growth is driving an expansion in aircraft leasing and the need for financing. According to Flight Fleets Analyser, the number of leased fleets operated in the Middle East has increased by 38 percent from 189 in 2011 to 260 in 2016. In the Asia-Pacific region, the number of leased fleets grew from 781 to 1,857, more than doubling over the same period.

Salmaan Jaffery, Chief Business Development Officer of the DIFC Authority, commented: "We are witnessing continuous strong growth in DIFC's aviation finance sector. The use of our structures for aircraft leasing and financing transactions represents the third wave of finance enabled by the DIFC after banking and asset management."

He continued: "Dubai's incredible success as a global aviation hub will continue to support the industry. The increase in regional demand creates significant opportunity for aviation leasing and finance firms in the Middle East, Africa, and South Asia region who are driving deal flow via DIFC's established regulatory and legal frameworks."

The first aviation finance transaction conducted in DIFC was by Emirates Airlines in 2009.

DIFC is a free trade zone located in Dubai, which offers a number of perks to firms, including zero percent income tax guaranteed for 50 years and no exchange controls. It permits 100 percent foreign ownership.

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