The International Air Transport Association (IATA) has today released a press brief, in which it has mentioned the importance of relief funds to help the struggling African aviation sector. The statistical report provides an insight into the massive losses airlines of African countries are taking due to the spread of coronavirus and ongoing travel restrictions.
Assessing the current circumstances, IATA has made an estimation of the African aviation industry based on travel restrictions and passenger demand. It has clearly stated that “These estimates are based on a scenario of severe travel restrictions lasting for three months, with a gradual lifting of restrictions in domestic markets, followed by regional and intercontinental.”
A summary of results is as follows:
- African airlines are expected to suffer a cumulative loss of $6 billion in passenger revenue in 2020 when compared to 2019 numbers.
- Job losses in aviation and related industries could grow to 3.1 million. This is 50% of the region’s total aviation-related workforce.
- Full-year 2020 traffic is expected to plummet by 51% compared to 2019.
- GDP supported by aviation in the region could fall by $28 billion from the current $56 billion
The worst-hit countries
The ten worst-hit countries, ranked by decline in the number of passengers, are:
- South Africa: 14.5 million
- Nigeria: 4.7 million
- Mauritius: 3.5 million
- Kenya: 3.5 million
- Ghana: 2.8 million
- Senegal: 2.6 million
- Ethiopia: 2.5 million
- Cape Verde: 2.2 million
- Tanzania: 1.5 million
- Mozambique: 1.4 million
In recent days, we have seen African airlines requesting financial support from their respective governments to help survive the brunt of coronavirus impact. However, many of the airlines have not been successful in doing so and are awaiting a very uncertain future.
Air Mauritius had yesterday decided to enter a voluntary administration. South African Airways has said that it will lay off all of its staff by the end of April. We are expecting to see a similar trend in the coming days, unless various governments intervene. As a result of this, IATA has made an honest plea to the governments of African countries. It emphasized the fact that the collapse of the airline industry will have long-lasting and far-reaching effects on the economy.
“More airlines will follow if urgent financial relief is not provided. The economic damage of a crippled industry extends far beyond the sector itself. Aviation in Africa supports 6.2 million jobs and $56 billion in GDP. Sector failure is not an option, more governments need to step up.”
In positive developments, some African countries have, in the past few weeks, made amendments to support the aviation industry. For example, Senegal has announced a US$128 million in relief for the Tourism and Air Transport sector. Additionally, Seychelles and Cote d’Ivoire have waived specific airport and transit taxes.
In addition to vital financial relief, the industry will also require careful planning and coordination to ensure that airlines are ready when the pandemic is contained. This will take a lot of effort and analysis, which includes prioritizing the lifting of travel restrictions and recovering passenger confidence. IATA has advised African countries to have a cooperative and harmonized approach to battle the impact of coronavirus.
Do you agree with this analysis? Let us know in the comments.