Business

Concern over Africa’s ‘empty’ skies

As European and American skies remain busy and African skies are empty occasioned by poor connectivity among nations on the continent, WOLE SHADARE highlights the consequences of this to a continent that is rich in potential, but oblivious of how to harness

 

Potential Africans make up 12 per cent of the world’s population, but only 2.5 per cent of the world’s passengers. So, why is there such a gap? The continent has 731 airports and 419 airlines with an aviation industry that supports around 6.9 million jobs and $80 billion in economic activity.

 

According to the International Air Transport Association (IATA), Africa is set to become one of the fastest growing aviation regions in the next 20 years with an annual expansion of nearly five per cent. While it is evident that aviation in Africa has the potential to fuel economic growth, several barriers exist.

 

Weak infrastructure, high ticket prices, poor connectivity and lack of liberalization are some of the many challenges.

 

The reality Airport infrastructures in most African countries are outdated and not built to serve the growing volume of passengers or cargo. Airlines and airports are often managed by government entities or regulatory bodies. Foreign investment is discouraged.

 

In Malawi, for example, it’s illegal for a foreign airline or private investor to own more than 49 per cent of a national airline. So, this prevented Ethiopian Airlines from purchasing more than 49 per cent stake in Malawian Airlines.

 

 

Yet, modernising infrastructure and operations requires both investment and expertise, ideally from public-private partnerships. Africa needs to open its doors for private capital investment.

 

Countries such as Côte d’Ivoire and Rwanda are heeding this call and making strategic bets in the sector, while employing best practices to drive vibrant aviation growth.

 

Take the outstanding example of the Abidjan International Airport. In 1996, management and operation of the terminal in Côte d’Ivoire were privatised and awarded to AERIA, a French company. Ownersh

of AERIA is shared by private investors (65 per cent), a technical partner (25 per cent) and Côte d’Ivoire (10 per cent).

 

The company has invested in infrastructure and delivered quality service, impressing the government so much that the concession has been extended. When private capital is involved, as it was in Côte d’Ivoire, partnerships can build greater efficiency, higher revenue and better quality service that demand financial discipline and eliminate corruption.

 

Still, governments have an important role to play in delivering economic and social benefits by championing intercontinental aviation as well as shaping a dynamic African aviation sector.

 

Protectionism versus liberalisation

 

 

Not a few believe that liberalisation will bring strong outcomes – new routes, more frequent flights, better connections and lower fares.

 

These improvements according to them will increase the number of passengers, which will have both direct and indirect positive effects on trade, business travel and tourism. In turn, this has impacts for the broader economy, generating more tourism revenues, jobs and productivity. That will enhance the GDP of African countries and improve the welfare of ordinary Africans.

According to an IATA survey, if just 12 key African countries opened their markets and increased connectivity, an extra 155,000 jobs and $1.3 billion in annual GDP would be created in those countries.

 

The protectionism tendencies by many African governments over their national carriers or flag carriers have stunted the growth of air travel in the continent as they are oblivious of the huge benefits and prosperity that comes with liberalisation. The lack of liberalisation affects connectivity and ticket costs. In Africa, no direct flight exists to travel from Abidjan, a hub in West Africa, to Dar Es Salam, a hub in East Africa.

 

Instead, a traveller inefficiently flies to a second or third country before reaching the final destination. Across the globe, on average, low-cost carriers are about onequarter of all flights. In Africa, however, they’re less than 10 per cent, which obviously makes ticket prices somewhat prohibitive.

 

So, what lies ahead for Africa? First, the Single African Air Transport Market introduced earlier this year aims to open up African airspace and improve intra-African air connectivity.

 

So far, 26 African countries have signed up. The movement is promising and will be more effective once all African countries come onboard. Kinshasa, the capital of the Democratic Republic of the Congo, is one of the biggest cities in Africa, with an estimated population larger than London and a skyline that peers over the wide, snaking Congo River.

 

 

But if a traveler wants to go Aviation in Africa has the potential to fuel economic growth… several barriers exist from there to Lagos, Nigeria’s commercial capital and Africa’s largest metropolis, it’s impossible to fly nonstop. Roughly 1,100 miles separate the two megacities — about the same distance as New York to Minneapolis.

 

But there are no direct flights. Instead, a traveler will need to change planes at least once and pay a minimum of $1,200. There’s a good chance the journey will take well over 12 hours. Across Africa, the situation is similar.

 

Commercial flights are infrequent, expensive and circuitous. To get from one country to another, an African traveler may have to go thousands of miles out of their way and transfer through the Middle East or Europe.

 

An airline operator with one of the leading carriers based in Lagos and who pleaded anonymity said: “Time-wise, it can be a bit frustrating.” The operator, who travels around the continent for work said flying many countries in Africa is as herculean and tasking than to travel to any remote place in Europe.

 

Why is it so difficult to fly around Africa

 

? Blame a combination of protectionist legal barriers and regulatory hurdles, mixed with inadequate infrastructure, high taxes, and stubborn nationalism. Airlines trying to launch a new route between African nations need to first secure per

mission from both countries, which can be a lengthy and expensive prospect that may or may not involve significant bribes. Forty-four African nations signed on to a 1999 agreement promising to promote competitive markets and remove regulatory barriers. But to date, few have actually implemented the plan, known as the Yamoussoukro Decision (named after the Côte d’Ivoire capital in which it was reached).

 

Countries across the continent have displayed protectionist tendencies to limit others’ access to their own airspace. Those instincts began a generation ago, when newly independent nations sought to assert themselves by creating national airlines, and continue today.

 

Yet even as flag carriers across the continent edge toward financial ruin, additional countries, including Uganda and Nigeria.

 

Last line

 

There is, however, an exception to the ignoble rule of how things are done in Africa. One African nation that appears to be eager to tap its air power is Ethiopia. The state-owned airline is the only profitable African carrier and has some of the best reach across the continent. Ethiopia is also investing heavily in a massive new airport, as well as an expansion of the current hub outside of Addis Ababa.

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