by MTHULISI SIBANDA
JOHANNESBURG, (CAJ News) – AFRICAN countries are missing out on an opportunity to grow their economies amid the snail pace of the liberalisation of their airspace.
This is much to the concern of a leading international management consulting firm, which reiterated the fact that the issue of limited intra-African flights and high costs has long been a dampener to growth in the continent.
“Given the role that air travel plays in creating employment, facilitating trade, enabling tourism, and supporting sustainable development, this is an issue that urgently needs addressing,” said Paul Calvey, Partner and Market Lead at Oliver Wyman South Africa.
He noted there were several reasons for those higher costs, including restrictive regulatory environments, high taxes and a lack of infrastructure.
“This has resulted in missed opportunities,” Calvey said.
He cited an article from March 2022, for example, revealing there were just two direct flights a week between Lagos, Nigeria, and Douala, Cameroon at the time.
That is despite the fact it is only a one-and-a-half flight along one of Africa’s busiest corridors.
In addition, there are currently no direct flights between Lagos and Kinshasa, in the Democratic Republic of Congo (DRC), yet these are the two biggest cities in West and Central Africa respectively.
Oliver Wyman’s PlaneStats data shows that Africa has one of the lowest airline seats per capita of any region in the world.
This is just 0,12, compared to Europe’s 1,5, while the United States has more than 3,5 seats per capita.
“This puts into context how much room for growth exists across the continent,” according to Calvey.
Oliver Wyman analysis also shows that only 17 million of the 177 million seats on African flights that took off in 2022 were intra-African.
By comparison, the South African domestic market alone accounted for 15 million seats in 2022.
“So, the potential for growth for travel across the continent is significant,” Calvey said.
“Encouragingly, there are a growing number of examples that showcase what’s possible when African countries open their skies.”
When South Africa and Zambia reached a bilateral open-skies agreement in 2013, for example, flight prices between the two countries fell almost 40 percent and air traffic increased 38 percent, according to a report by the United Kingdom’s Business Environment Reform Facility.
In another initiative aimed at opening the entire continent’s skies, a bloc of African countries agreed to take part in a pilot implementation project, designed to act as a precursor to the Single African Air Transport Market (SAATM).
The agreements will mean airlines are increasingly able to offer more intra-African flights at better prices.
Growth in intra-continental routes by low-cost carriers is forecast to put pressure on national and group-based airlines to push their prices down to remain competitive.
And if these routes are successful, there will be even more incentives for African governments to put accelerated liberalisation policies in place,” Calvey said.
– CAJ News