African Airlines Face Tough Future With Ebola Spread To US

African Airlines Face Tough Future With Ebola Spread To US

From PanaPress

The Ebola spread to the US has created fears that US aviation authorities could slap travel restrictions, which would signal a major crisis for African airlines struggling to make profits, analysts warned in a report on Thursday.

DaMina Advisors, an African political risk advisory service firm, warned that with the first US confirmed case of Ebola diagnosed in Texas and growing public pressure on the Obama administration to restrict US airline travel to West Africa, the financial viability of a number of already struggling domestic African airline carriers may be under threat.

Africa’s financially struggling airline industry, which supports over 7 million jobs and contributes US$80bn in Gross Domestic Product (GDP), may witness several financial insolvencies if the US and European Union impose travel restrictions to West Africa.

There are fears if the travel restrictions specifically target Nigeria, Ghana, Senegal and Cote d’Ivoire, the potential of crippling the region’s economy would increase.

“While a US and EU airline travel ban on flights from Guinea, Liberia and Sierra Leone may not materially affect the financial viability of the struggling West African airline companies, any flight bans on travel from larger economies of Nigeria, Ghana, Senegal and Cote d’Ivoire has the real potential of financially crippling several domestic African carriers and negatively impacting West Africa’s GDP for 2014,” DaMina warned.

African airline companies are severely hit by poor airport infrastructure, high costs of operations and high insurance premiums.

The business challenges make the airlines least profitable aviation companies globally, according to the International Air Transport Association (IATA).

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