What Africa Must Do to Benefit from Aviation

By Abdi Ali
Published January 29, 2018

International Air Transport Association (IATA) forecasts Africa will be a market of 350 million airline passengers by 2035 and identified four priorities which must be addressed if aviation is to deliver maximum economic and social benefits for the countries on the continent.Though aviation is reported to be supporting 6.8 million jobs and contributes US$73 billion in gross domestic product (GDP) across Africa, blocked funds, limited connectivity, poor infrastructure and concerns over safety are preventing the continent from reaping maximum benefits from the sector.

Speaking in the Angolan capital, Luanda, during the International Air Transport Association (IATA) Aviation Day on January 18, 2018, Alexandre de Juniac, Director-General and Chief Executive Officer of IATA, said a recent study by IATA had found that an extra 155 000 jobs and US$1.3 billion in annual GDP would be created if 12 key African markets were opened up.

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Though IATA forecasts a trebling in the size of Angola’s air transport market to 7.1 million passengers a year by 2036 at the present forecast annual growth rate of 6.7%, the organisation says the southern African country could register faster growth with greater socio-economic benefits were the country opened to open up its market, participate in the African Union’s Single Africa Air Transport Market (SAATM), unblock funds, consult with industry to improve infrastructure and maintain world class safety standards.

Alexandre de Juniac, Director General and Chief Executive Officer of IATA, says it is in everybody's interest to ensure that airlines are paid on-time, at fair exchange rates and in full.“Aviation connects people and businesses, enables trade and tourism, reunites families and friends, carries products to markets and vital medicines and aid to communities where they are needed. Angola needs to work with industry to ensure that it is prepared to reap the future benefits of increased air connectivity,” said de Juniac.

Expounding on each of the four pressing concerns that he said are found not just in Angola but across Africa, de Juniac said they must be addressed for there to be a healthy and strong aviation system.

Blocked funds and denied access to foreign exchange in Africa is an increasing problem. In nine African countries, international carriers are unable to repatriate their foreign currency earnings, while locally-based airlines experience difficulties making on-time foreign currency payments to their suppliers and business partners.

“Blocking airlines’ funds is not the answer. It is in everybody’s interest to ensure that airlines are paid on-time, at fair exchange rates and in full,” explained de Juniac.

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Enhanced connectivity, de Juniac said, will stimulate demand and competition, making air travel more affordable and in doing so, enable higher volumes of trade, tourism and commerce between Angola, her sister nations and the rest of the world.

If Angola opened up its market, an IATA study indicates, an extra 531 000 passengers would take to the skies, 15 300 new jobs created and an an extra US$137 million GDP would be generated.

IATA Aviation Day was marked in Luanda, Angola, on January 18, 2018.Modern infrastructure may be critical for aviation to deliver its economic and social benefits. However, consultation is needed to ensure that infrastructure is aligned with airline requirements.

Airlines need airports that match demand with capacity while delivering the functionality, levels of service, and efficiency to support operations and customer experience requirements now and in the future. All of this must be delivered in a cost-effective manner. Unnecessary capital investment leads to higher costs for airlines, which translate into higher costs for passengers, resulting in reduced demand for air travel.

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Though safety is critical in aviation, IATA says this has always been a challenge for Africa. With governments and industry working together significant improvements have been achieved. In 2016, for example, there were no fatal accidents or hull losses involving sub-Sahara African scheduled airline services. To sustain and further improve this safety performance, continuous effort based on global standards and best practices is needed.