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IATA Outlines its Thoughts on West African Aviation Landscape


Ahead of the AviaDev conference coming up in Kigali in October, 2017, Jon Howell (JH) of AviaDev spoke with Adefunke Adeyemi (AA), the Regional Director of Member and External Relations for Africa and the Middle East at IATA.

JH: We cannot talk about West Africa, without talking about its biggest economy, Nigeria. As a Nigerian yourself, how concerned are you about the current aviation environment in the country at present and what is being/ should be done to rectify this?

AA: The aviation industry in Nigeria is key to accelerating its economic recovery and growth. Currently, the aviation industry in Nigeria supports more than 650,800 jobs and contributes US$8.2 billion to the country‘s GDP. Over the next ten years passenger volumes are forecast to grow by more than 7% annually; which translates to an additional 7.9 million passengers every year in Nigeria. The Nigerian government is also actively supporting the aviation industry through investment in infrastructure and policy support and we hope this will continue and intensify. Nigeria’s continued adherence to international best practices and an optimal regulatory and operating environment will be critical if aviation is to unlock the enormous economic potential that exists within Nigeria.

Looking beyond West Africa, the future is very bright for African aviation. The top ten fastest-growing markets in the world are in Africa: Sierra Leone, Guinea, Central African Republic, Benin, Mali, Rwanda, Togo, Uganda, Zambia and Madagascar. Each of these markets is expected to grow by more than 8% each year on average over the next 20 years, doubling in size each decade. As a region, Africa will grow by 5.1%. By 2035 it will see an extra 192 million passengers a year for a total market of 303 million passengers.

However, growth is not guaranteed. In order for African aviation to prosper, the industry must be regulated in a way that will allow it to achieve its full potential. This means balancing commercial realities while ensuring global standards for the carriage of passengers and goods. Passenger confidence is also key if aviation is to be selected over other means of transport. Therefore, Safety must continue to be the number one priority for the region. We are pleased to note that the joint efforts of all stakeholders particularly the Civil Aviation Authorities has seen Africa’s global safety record improve significantly. In 2016 there were no hull losses recorded across the continent. The focus now is on maintaining the strong gains made over the last few years and continuing to promote the importance of IOSA (IATA Operational Safety Audit) and ISSA (IATA Standard Safety Assessment) to all airlines.

Another challenge facing African aviation is the high cost of taxes and charges on fuel which is much higher in AFI compared to other regions in the world. Fuel prices in Africa are on average are 21% more expensive than the global average. These taxes increase the cost burden of airlines who are already operating in a challenging environment and hinder the growth of an industry that brings extensive socio-economic benefits. All Stakeholders need to come together to bring down these costs so that travel can be cheaper in Africa, leading to better accessibility and traveller conversion.

In parallel countries in Africa need to continue to tackle the region’s main issue, connectivity within the continent. The importance of the ongoing Single African Air Transport Market (SAATM), spearheaded by the African Union through the African Civil Aviation Commission, to Africa and African carriers cannot be emphasized enough. African States and carriers must fully embrace SAATM in order to reap the numerous benefits of enhanced connectivity which include not only increased market share but also reduced fares, travel times and more route options for consumers, leading to increased tourism, trade, jobs and overall economic growth as well as an improved aviation environment throughout Africa.

The outlook for aviation in Africa including Nigeria is very positive but requires true collaboration, fulfilment of mutual obligations and fresh thinking to achieve its potential. Aviation has been recognized for its transformative value and we encourage governments not only in Nigeria but across Africa to continue to promote aviation for its role as a catalyst and socio-economic enabler and to promote stronger connectivity both within their respective countries and their neighbouring countries.

JH: West Africa has also seen some notable successes such as ASKY from Togo and Africa World Airlines from Ghana. Do you feel that we will continue with smaller operators or do you think a single or a couple of carriers will provide the regional connectivity in West Africa?

AA: African carriers are resilient and with a more conducive environment, we will have a lot more success stories like ASKY and Africa World Airlines. A lot of the advocacy IATA does is to towards creating an operating environment for airlines to thrive. This is why we regularly engage governments wherever there are incidents of high taxes and charges, inadequate infrastructure, blocked funds, to name a few. IATA also provides several free capacity building courses for airline staff and management as well as regulatory officials via IATA’s Airline Training Fund (IATF). We are proud that the industry’s collective efforts are paying off and the industry is collectively reaping the benefits of safer African skies.

There are many different types of successful airline business models in operation across the world. What is important is that these airlines are supported by an effective infrastructure and Smart Regulation. African nations have an opportunity to enact smarter regulation to enable better aviation connectivity. Implementation of the Yamoussoukro Decision will open up air routes within the continent and provide opportunities for more than 5 million additional passengers a year.

In 2014, IATA commissioned a study on ‘Transforming Intra-African Air Connectivity: The Economic Benefits of Implementing the Yamoussoukro Decision’. This joint study in collaboration with AFRAA/AFCAC and ICAO includes an analysis of the impact of liberalizing air markets in 12 countries (Algeria, Egypt, Tunisia, Ethiopia, Kenya, Uganda, Angola, Namibia, South Africa, Ghana, Nigeria and Senegal). The study concluded that such liberalization would result in an extra 155,000 jobs and $1.3 billion in additional GDP; an 81% increase in total traffic flows between the 12 countries; and new direct routes between 17 country pairs.

Improved Intra-Africa connectivity would transform the industry and likely see the emergence of a host of new airline strategies and partnerships. IATA fully supports the establishment of the Single Africa Air Transport Market (SAATM). We commend the efforts of the African Union, through the African Civil Aviation Commission (AFCAC), on the planned launch of the SAATM in early 2018. Once the SAATM is established, there will be more than enough room for traditional models, such as the full-service networks and regional carriers, and we will even see a rise in true regional low-cost carrier models as secondary airports become available and accessible.

JH: How many hubs do you think West Africa can support and where do you think they will be found?

AA: The question should be what are African Governments doing to support aviation in their countries to unleash the massive economic benefits that aviation can bring. Countries that have placed aviation at the heart of their national planning and development are strategies are today reaping enormous benefits in terms of trade, tourism, passenger growth and much more, we need only look to Dubai, Doha, Abu Dhabi and Jeddah.

In West Africa, to all intents and purposes, we already have hub-like airports in Nigeria, Togo, Ghana, Senegal, Cote d’Ivoire. And with the imminent launch of the SAATM, the potential for these hubs to grow and the creation of new ones is significant. However there is a caveat, governments must support aviation via a conducive environment; meaning reduced industry costs and a favourable regulatory and operating environment.

Adefunke Adeyemi is the Regional Director of Member and External Relations for Africa and the Middle East at IATA. A well-respected lawyer with industry experience, she will be joining the AviaDev this October, moderating a panel entitled "The battle for West Africa's skies". This session will discuss which hubs will grow to be the main players in the coming years and which airlines will take advantage of a burgeoning, but fragmented West African market.

#Interviews #IATA

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