Good morning. Thank you very much for inviting us here to speak today. I am here, as the chair said, on behalf of the Greater Toronto Airports Authority. We are the private not-for-profit organization that operates Toronto Pearson. My name is Lorrie McKee, and I am the director of public affairs and stakeholder relations.
Pearson is Canada's largest airport. We served 44 million passengers in 2016. We expect to end this year at 47 million passengers, so that's a three million increase. The airport facilitates about 42 billion dollars' worth of Ontario's GDP. That's about 6.3%.
Looking forward to the growth we see coming, by 2037 we expect that the airport will double in passenger numbers, up to about 85 million passengers. I should note that the number of aircraft movements is not growing at the same rate. It's a slower rate. It's mirroring our population growth, about 1.5%.
The growth we are experiencing reflects what our region and the country's growth is, and what our local economies are demanding of us. As the region grows, there is an opportunity for the airport's economic contribution to grow in step. For 20 years, the GTAA has been making the necessary investments to make sure that aviation needs can be met, and we are committed to continuing to do that.
While the airport is operated by the GTAA, the federal government plays an important role in getting passengers to and through the airport seamlessly. We are looking to the government to continue in that partnership in three key areas.
The first is the excessive wait times for pre-board security screening on departure, and for customs and immigration upon arrival. Long lineups, flight delays, and missed connections negatively impact the economy and Canada's global competitiveness. Last year at Toronto Pearson, more than five million passengers waited longer than 10 minutes, and close to three million waited longer than 15 minutes for CATSA, which is the pre-board screening service. In 2016, nearly one million passengers waited longer than 20 minutes for customs screening at CBSA.
We are asking that the government increase CATSA and CBSA funding to efficiently manage passenger growth at Toronto Pearson, and implement a federally mandated service level standard for both agencies. To be competitive globally, we recommend that Canada establish and fund to a service level standard that would see 95% of passengers screened in 10 minutes or less.
The second area is this. For Toronto Pearson to maximize its national economic contribution as Canada's front door to the world, the way we connect people and businesses on the ground must be on par with the considerable success we've achieved at connecting them by air. There are 300,000 people working in the area around the airport. That area has been termed by the Neptis Foundation the second-largest employment zone in the country. However, it lacks good transit options, so the area's economic potential is not being achieved, given that lack of transit.
We know that congestion is only going to get worse, with travel times in and around the airport expected to increase 25% to 30% in the next 25 years. Today, only 10% of passengers and employees use transit to get to the airport, compared to 30% in Vancouver, 40% in Amsterdam, and 60% in Shanghai, for example. You can see how we are lagging behind other world-class airports.
Toronto Pearson and the GTAA have committed to investing funds to build a regional transit centre—a Union Station West, so to speak—on airport and federal lands. The centre would connect some planned regional transit lines such as the Mississauga BRT, the light rail systems for Eglinton and Finch, potentially GO regional rail, and the proposed high-speed rail from the province. A regional transit centre at Toronto Pearson would help ease the congestion around the airport and move people and goods.
As I said, we are prepared to make the investment and build that facility, but we are looking to governments at all levels to work collaboratively and advance the necessary studies on the various lines to bring this transit centre to life.
Finally, in the third area, we ask that the government consider some changes to the duty-free rules so that Canadian airports can deliver what travellers have come to expect at major international airports: dual duty-free and arrivals duty-free.
Dual duty-free is a process that would allow a domestic passenger in a mixed area to buy products at duty-free stores and pay all the duties and taxes that are applicable. Nationally, we calculate that this would increase sales and generate federal and provincial taxes in the magnitude of about $3.8 million annually.
We are also asking for arrivals duty-free. This is something that has been talked about for many years. More than 60 countries around the world have introduced a way to have arrivals duty-free at their airports, but Canada has not yet made that choice. We expect the financial benefits of arrivals duty-free would be about $350 million in repatriated sales that are currently happening in foreign airports, more than 700 new jobs, and nearly $18 million in taxes.
We request that the government work with the provinces to introduce both a dual shop program and an arrivals duty-free so we can be competitive with our global partners.
In closing, as the country's largest airport connecting Canada to 70% of the world's economy, Toronto Pearson does play a critical role in the economic activity of the country. We allow Canadian businesses to reach domestic and global markets, generate jobs and taxes, and facilitate trade, foreign investment, and tourism. The federal government's programs need to evolve in step with our growth.
Thank you very much. I'm happy to take any questions.