AVIATION
Risks and Crisis Issues for
International Corporations in the Aviation
Sector – BRICS Countries
The aviation sector across BRICS countries is a high-potential yet high-risk environment for international corporations. Rapidly growing middle classes, tourism, and infrastructure investments offer significant opportunities. However, the sector is tightly interwoven with national security interests, state-owned enterprises, and protectionist policies. Regulatory hurdles—ranging from airspace access to route rights—can be unpredictable and heavily politicized, especially in markets like Russia and China. Market entry often requires joint ventures or deep alignment with local interests, creating long-term operational and strategic dependencies.
Over the past five years, the aviation landscape in BRICS has been marked by volatility and uneven outcomes. Russia’s aviation sector faced severe setbacks following Western sanctions in 2022, cutting off access to aircraft parts and forcing a pivot to domestically manufactured jets with limited international competitiveness. In contrast, China’s COMAC C919 passenger jet began commercial operations in 2023, showcasing Beijing’s ambition to reduce reliance on Boeing and Airbus. South African Airways, after years of mismanagement and financial collapse, underwent restructuring with mixed investor sentiment. Meanwhile, Brazil’s Embraer maintained a strong position globally, especially in regional aviation, though its proposed joint venture with Boeing was canceled in 2020. India saw strong domestic traffic recovery post-COVID, but foreign carriers like Etihad faced turbulence due to the collapse of Jet Airways, in which it was invested.
The aviation sector is acutely sensitive to macroeconomic and geopolitical shifts. Currency volatility, fuel price spikes, and infrastructure constraints (e.g., congested airports, limited maintenance facilities) increase operational risk. Additionally, safety regulations, pilot training standards, and certification processes vary widely across BRICS, complicating compliance and liability management. For international corporations, a tailored, risk-sensitive approach is essential—balancing opportunity with an understanding of political dynamics, partner reliability, and crisis readiness
5 Key Risks
to Consider before Entering BRICS Aviation Markets:
1. Geopolitical and Sanctions Exposure – Risk of asset seizure, restricted parts supply and disrupted international operations.
2. Regulatory and Bilateral Agreement Volatility – Sudden changes in route rights, airspace access, and certification requirements.
3. State Intervention and Market Distortion – Dominance of state-owned or protected carriers impacting competition and neutrality.
4. Operational Infrastructure and Safety Gaps – Limited maintenance facilities, air traffic control inefficiencies, and safety standard disparities.
5. Financial and Currency Risk – Revenue exposure to unstable currencies, government-backed credit defaults, or aviation fuel price spikes.
TO GO FURTHER
CRISIS MANAGEMENT
Know-How, Tools & Resources for Crisis Resolution
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Crisis Assessment & Source Identification
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Crisis Management Coordination
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Crisis Containment & Damage Control
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Crisis Communication & Media Kit
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Crisis Cell Infrastructure
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Crisis Simulation Training [New]
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Business Recovery Plan & 361° Review