The level of worldwide airline passenger demand growth fell back last year amid political tensions and weak trade activity.
The slowdown was the first since the global financial crisis in 2009, Iata revealed.
Looking forward, the airline trade association warned of “significant schedule adjustments” on China routes due to coronavirus.
Iata director general and chief executive Alexandre de Juniac said: “2019 was a difficult year for aviation and 2020 is off to a tragic and challenging beginning.
“The shooting down of [Ukraine Airlines flight] PS 752 in January was inexcusable.
“Commercial aircraft are instruments of peace, not military targets.
“To honour the victims of this tragedy we must address this challenge with governments and stakeholders.
“Our thoughts are also with the injured, and the families of those who lost their lives, in the PC2193 [Pegasus Airlines] accident in Turkey.
“Safety is the aviation industry’s number one priority and we are united in our desire to understand and learn from the circumstances of this tragedy.”
He added: “Today, headlines are also focused on the novel coronavirus.
“From our experience of past outbreaks, airlines have well-developed standards and best practices to keep travel safe. And airlines are assisting the World Health Organisation (WHO) and public health authorities in efforts to contain the outbreak in line with the international health regulations.
“There currently is no advice from WHO to restrict travel or trade.
“But it is clear that demand has fallen on routes associated with China, and airlines are responding to this by cutting capacity for both domestic and international China.
“The situation is evolving fast, but we are observing significant schedules adjustments for February.”
He was speaking as Iata reported that passenger demand in 2019 rose by 4.2% compared to 7.3% for the previous year and below the long-term trend of around 5.5% a year.
Overall capacity climbed by 3.4% last year and the load factor rose 0.7 percentage point to a record high of 82.6%, up from 81.9% in 2018.
“Airlines did well to maintain steady growth last year in the face of a number of challenges,” de Juniac said.
“A softer economic backdrop, weak global trade activity, and political and geopolitical tensions took their toll on demand.
“Astute capacity management, and the effects of the 737 Max grounding, contributed to another record load factor, helping the industry to manage through weaker demand and improving environmental performance.”