Around a week ago, the World Economic Forum took place in Davos, Switzerland. The Forum primarily addressed the global financial crisis. One person who attended the Forum was Airbus CEO Tom Enders. Enders argues that in order to successfully finance expenditures on their products, a global financial system is needed.

An important distinction must be made between the companies that run airline services, such as Northwest Airlines and Air China, and the companies that manufacture the airplanes, such as Airbus and GKN. Enders’ concern is that those who run the airlines aren’t able to afford their products because they cannot get the proper financing they need to do so. Additionally, those who manufacture the supplies that Airbus uses in construction of the airplanes are struggling to obtain lines of credit which they can use to run their business.

With a global financial system, initiatives from governments through struggling banks would be able to provide a backstop for customers who cannot find commercial financial solutions. As air travel is expected to double by the year 2025, it is important that financial systems are able to support global airline companies as they enhance their fleets and operating methods. Since air travel is so intertwined on the global level, it might make sense to globalize the financial system. However, such economic interdependence could possibly bring more harm than benefit. Only time will tell what reforms are made to the global financial model.

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