International airlines are carrying 82 percent of the traffic to and from Africa, while African airlines carry only 18 percent, and government policies are largely to blame, according to Jayne Boccaleone in BusinessDayLive.
The Airlines Association of Southern Africa annual meeting in South Africa painted a picture of domestic aviation industries in crisis, with a catastrophic drop in inbound tourists, lack of political will to open up African skies and government policies that result in disastrous visa regulations.
And that was just the opening speech.
Africa has 15 percent of the world’s population, 20 percent of its land mass, but accounts for 3 percent of global passenger traffic.
It gets worse.
In 2014, aviation saw a global turnaround, with 4 percent average margins, up from 1 percent, but profitability for African airlines remains the biggest challenge.
Global average profit per passenger is $8.27, while in Africa it is $1.59. High infrastructure charges, taxes, too many small state-owned and unprofitable airlines and a lack of co-operation among African states all contribute, but the core problem is low passenger volumes and a high cost per seat. The still small middle-class population means few can afford to fly.
The Airlines Association of Southern Africa is open to all airlines in countries south of the equator, including the Indian Ocean Islands. There are 19 member airlines and 29 associate members including tourism organizations, airports, air traffic services, weather services, oil companies and major aircraft manufacturers.
Average aircraft occupancy in Africa is about 65 percent compared to 80 percent globally.
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Key to African aviation and economic growth is open skies. The failure of African governments to implement the Yamoussoukro Decision to deregulate air services and to open regional air markets to transnational competition is a direct barrier, BusinessDayLive reported.
Sixteen years after the decision, only 11 of the 44 signatory countries have signed, including South Africa and Zimbabwe. An independent report commissioned by the International Air Transport Association found that implementing it in 12 key African markets would create 155,000 jobs, $1.3 billion in annual gross domestic product and potentially 5-million new passengers a year. For South Africa, this would mean 14,500 jobs and $284 million in GDP, says Iata.
Political will to open African skies to drive the continent’s growth, trade and tourism needs to override nationalist concerns.
Aviation and tourism have a symbiotic relationship and both need to succeed. South Africa needs to align conflicting policies and agendas between government departments dealing with travel and tourism. The government needs to get its act together before it is too late for these two critical industries.