AFRAA: Pressure Mounts to Open Up African Skies

Financial Gazette Harare
Displayed with permission from allAfrica.com

PRESSURE is mounting on African countries to open up their skies.

The African Airlines Association (AFRAA), which has a membership of 37 African countries, and the African Union (AU) last week called upon governments to sign the Yamoussoukro Declaration (YD).

The AU in January 2015 made a commitment to fully open the African skies by next year.

« Currently 15 States, including Zimbabwe, have declared their solemn commitment to fully open their skies immediately, unconditionally in accordance with the YD, » AFRAA secretary general, Elijah Chingosho, told airline executives at the 48th annual general assembly of the organisation in Victoria Falls.

« We appeal to the remaining African States to join the 15 States, » said Chingosho, a Zimbabwean national.

In 1999, African governments made bold moves to liberalise their skies at a conference in Yamoussoukro, Ivory Coast.

But even after 44 countries committed to liberalise their skies, this has remained a pipedream 17 years on.

An International Air Transport Association (IATA) study titled Transforming Intra-African Air Connectivity: The Economic Benefits of Implementing the Yamoussoukro Decision, has outlined the benefits of liberalisation.

Completed in July 2014, the study said reluctance by governments to open up to foreign competition had undermined growth of African economies.

It said closed markets limit access to the region, as well as prolong the time that goods arrive to destinations.

« While many air markets between Africa and countries outside of Africa have been liberalised to a significant extent, most intra-African aviation markets remain largely closed, subject to restrictive bilateral agreements which limit the growth and development of air services, » said the report.

« This has limited the potential for aviation to be an engine of growth and development. While many air markets between Africa and countries outside of Africa have been liberalised to a significant extent, most intra-African aviation markets remain largely closed, subject to restrictive bilateral agreements which limit the growth and development of air services. This has limited the potential for aviation to be an engine of growth and development, » the report said.

It noted that liberalisation leads to increased air service levels and reduced fares, thereby stimulating traffic volumes as well as boosting tourism and trade.

The report said there was considerable evidence that liberalisation of international air markets had provided substantial benefits for passengers and economies.

It said one study of the EU (European Union) single aviation market revealed that liberalisation had increased competition on many routes.

As a result, new routes had been opened leading to a 34 percent decline in fares.

« Furthermore, other studies have demonstrated a link between increased air traffic and growth in employment and gross domestic product (GDP). One study estimated that each 10 percent increase in international air services led to a 0,07 percent increase in GDP, » says the report.

IATA said achievements of a liberal air market included:

– A 69 percent rise in passenger traffic after South Africa and Kenya agreed to a more liberal air market in the early 2000s.

– Allowing the operation of a low cost carrier service between South Africa and Zambia (Johannesburg-Lusaka) resulted in a 38 percent reduction in discount fares and 38 percent increase in passenger traffic.

– Ethiopia’s pursuit of more liberal bilaterals (on a reciprocal basis) has contributed to Ethiopian Airlines becoming one of the largest and most profitable airlines in Africa. Research has found that on intra-African routes with more liberal bilaterals, Ethiopians benefit from 10 to 21 percent lower fares and 35 to 38 percent higher frequencies compared to restricted intra-Africa routes).

The report also said in liberalised markets, there are substantial benefits to passengers. These include fare savings — passengers travelling between these countries are expected to benefit from fare reductions of 25 to 35 percent, providing a saving of over US$0,5 billion per annum, the report says.

However, African governments, which largely control struggling flag carriers, have been reluctant to commit to this agreement, which has triggered the collapse of scores of domestic airlines.

In Zimbabwe, passengers have been avoiding the under-capitalised AirZim, preferring well resourced airlines that have fifth freedom rights on some routes.

afrika54news

ACTUALITÉ AFRICAINE À TOUTE HEURE

You May Also Like