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As things look better, airlines around the world will make less money in 2022.

DOHA, Qatar (Reuters) –A sharp rebound in air travel after the pandemic will allow airlines around the world to cut their losses this year and maybe even turn a profit in 2023, an industry group said Monday as it updated its widely watched forecasts.

The International Air Transport Association said that airlines around the world are now expected to lose $9.7 billion in 2022. This is a big change from 2021 when airlines were expected to lose $42.1 billion.

The prediction for 2022 is almost $2 billion better than the earlier prediction, which was for a loss of $11.6 billion.

The losses from last year are also less than what was expected, which was $52 billion. However, airlines meeting in Qatar have been told that high oil prices and inflation could hurt the fragile recovery.

IATA Director General Willie Walsh told an annual meeting of more than 100 airline leaders, “Our industry is now leaner, tougher, and more flexible.” “By 2023, the whole industry should be making money,” he said.

North America is expected to keep doing its best and be the only region to make a profit in 2022, which is expected to be $8.8 billion.

In Asia, where China’s borders are still closed and its domestic market is struggling because of its “zero-COVID” policy, airlines expect to lose a total of $8.9 billion.

People want to make up for vacations they missed because of the pandemic, so airports and airlines are scrambling to hire tens of thousands of people to keep up with demand.

Some analysts are worried that after the northern summer peak, demand will drop sharply because of rising prices and the pressure on consumers to spend less because of inflation and rising interest rates.

In an interview, Walsh tried to downplay worries about a so-called “demand cliff” that would mean a quick recovery.

I don’t think it will be over soon. I think some pent-up demand is being met right now, but you have to keep in mind that we’re still a long way below where we were in 2019, “Reuters asked him about it.

“So I think we still have a long way to go before we can talk about whether or not that will start to slow down.”

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