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Global airline industry's net losses are expected to narrow down in 2021, the International Air Transport Association (IATA) said.

IATA expects net airline industry losses of $47.7 billion in 2021 - an improvement on the estimated net industry loss of $126.4 billion in 2020.

"This crisis is longer and deeper than anyone could have expected. Losses will be reduced from 2020, but the pain of the crisis increases. There is optimism in domestic markets where aviation's hallmark resilience is demonstrated by rebounds in markets without internal travel restrictions. Government imposed travel restrictions, however, continue to dampen the strong underlying demand for international travel," IATA Director General Willie Walsh said.

"Despite an estimated 2.4 billion people travelling by air in 2021, airlines will burn through a further $81 billion of cash."

In terms of revenue, IATA expects the industry to earn a total $458 billion which would be 55 per cent of the $838 billion generated in 2019 but represents 23 per cent growth on the $372 billion generated in 2020.

Besides, IATA said that travel restrictions, including quarantines, have killed demand.

It estimates that travel, measured in revenue passenger kilometres or RPKs, will recover to 43 per cent of 2019 levels over the year.

Notably, the 2021 RPK will be a 26 per cent improvement on 2020, but is far from a recovery.

"Domestic markets will improve faster than international travel," IATA said.

"Overall passenger numbers are expected to reach 2.4 billion in 2021. That is an improvement on the nearly 1.8 billion who travelled in 2020, but well below the 2019 peak of 4.5 billion."