KUALA LUMPUR - Asia Pacific airlines suffered a steep decline in passengers and cargo traffic in the first half of 2009, an industry group said Friday, warning the outlook remains challenging.

The Association of Asia Pacific Airlines (AAPA) said international passenger numbers fell 11.5% in the first six months to June, while air cargo volumes slumped 22.3%, compared with a year ago.

"The trading environment for Asia Pacific airlines remains extremely challenging," AAPA director general Andrew Herdman said in a statement, attributing it to the global economic slowdown and the swine flu outbreak.

"As a result, we still haven't seen a floor in terms of overall passenger demand," he added.

Herdman said the air cargo sector however showed signs of recovery.

"There has been a slow but steady recovery in air cargo demand from the lows seen at the end of 2008, and we are hopeful that this trend will continue in the second half of the year," he said.

Following several years of sustained growth in travel demand, the industry group has recorded a net loss of $4.3 billion in 2008, with international passenger numbers down 2.2%.

International air cargo traffic also declined by 6.7% last year.

AAPA is the trade association of major scheduled international airlines based in the Asia-Pacific region. It is headquartered in Kuala Lumpur.