Much is made of Africa’s economic potential. In academic journals and on the business pages of broadsheet newspapers, analysts and experts habitually detail opportunities for investment and growth. And while they are, for the most part, correct in their analyses, there is, for reasons known to us all, a permanent air of uncertainty surrounding just how wide-ranging this latent prosperity might be on a continent still traversing significant societal challenges. However, there is, perhaps, one issue that frustrates the broader African business community more than most: African governments’ protectionist stance on aviation.
In 1999, the Yamoussoukro Declaration (YD) called for the liberation of African skies. The agreement aimed to establish a single African air transport marketplace, avoiding restrictions imposed by bilateral air service agreements. Nearly two decades later, there has been no progress. Many nations restrict air services markets to protect the share held by state-owned carriers; a legacy of the 1960s when countries, desperate to showcase their independence to the outside world, founded national carriers. There is a growing recognition by politicians that this approach negatively impacts safety records, while pushing up fares and quelling air traffic growth. It’s worth remembering, too, that though the African continent commands 12% of the global population, it is only 1% of global air travel.
In a speech in January 2015, the Secretary General of the African Airlines Association (AFRAA) said that liberlised air travel in Africa would lead to improved safety, lower fares and increased traffic. Airline chief executives from South, West and East Africa have all made positive noises about change in the future; but there has still been no movement whatsoever.
The Yamoussoukro Decision was a big news story at the time, and much has been written since. But, given 17 years have passed, it’s worth reminding ourselves of the key points. The agreement called for:
– The full liberalisation of intra-African air transport services in terms of access, capacity, frequency, and tariffs
– The free exercise of first, second, third, fourth and fifth freedom rights for passenger and freight air services by eligible airlines
– Liberalised tariffs and fair competition
– Compliance with established ICAO safety standards and recommended practices
The failure to implement YD may be at the core of Africa’s air travel strife, but there are other more present issues with which airlines must contend. Access to jet fuel can be difficult. And, often, the cost is exorbitant. Jet fuel is traded in US dollars, against which most African currencies have very little buying power. In addition, jet fuel is, in most cases, subject to hefty government taxes.
And while the African governments fumble and fuss over the future, to the obvious detriment of the airlines and citizens they seek to service, the foreign-based megacarriers are cleaning up. Emirates, Etihad and Qatar Airways from the Middle East are carrying passengers in and out of a burgeoning number of African cities. Western European carriers, too, including Air France-KLM and Brussels Airlines, are capitalising on the continent’s reluctance to evolve with the times.
Is that bad news for corporates? Well, it depends on your stance: the influx of foreign carriers has pushed down fares and injected far more choice into the marketplace. However, transiting through foreign hubs for intra-African travel is hardly the most productive solution to business travel.
Industry associations have, since the turn of the Millennium, called for political leaders to see sense on this issue, but to no avail. Travel managers, for now, have to make the best of what’s available. But the wait-and-see approach is no longer fit for purpose if the Continent is to fulfill its so-called economic destiny. Industry bodies and big business must find new ways to articulate the argument and lobby for change.