The International Air Transport Association (IATA) predicted that the sector would see total profits for Asia plummet from around 1.7 billion US dollars in 2006 to some 1.2 billion dollars this year.

"The lower profits are due to the increased competition in the region as a result of liberalisation, aircraft deliveries and new entrants," the IATA said in a statement.

The warning accompanied data showing Asia, which in recent years has seen the emergence of many discount carriers, can expect strong gains in international passenger traffic while leading the global freight growth stakes.

Significant new capacity and routes will boost international passenger growth to an annual average rate of 5.7 percent between 2006 and 2010, beating a global average of 4.8 percent, IATA said.

Pakistan was expected to see the greatest advance at 8.2 percent, with China boasting 8.1 percent and India 7.9 percent while Australia would lag behind at 4.5 percent, the airline organisation said.

It also predicted freight in the Asia Pacific region -- where seven of the world's top ten cargo markets are located -- would grow 6.0 percent, again above the global rate which averages 5.3 percent.

While Asian economies were still expanding at a robust pace, which had helped boost traffic, IATA said the US economic slowdown was likely to soften demand for air travel and pricing power.

It also said the airlines it surveyed for its traffic forecast indicated they would adopt a more cautious approach to deploying new aircraft in the next five years.