African Airlines-Liberalise or Die

Article excerpt

THE TAIL END OF 2012 WAS A VERY GOOD month for aviation in Africa, particularly East Africa. Low cost carrier fastjet, based on the hugely successful easyJet model in Europe, began scheduled services from its current hub in Dar es Salaam to Mwanza and Kilimanjaro (see page 53) and LAM Mozambique Airlines took delivery of a spanking-new jet from the Brazilian maker Embraer.

Earlier in the year, Embraer delivered the 900th E-jet it has produced since 2004 to Kenya Airways' rapidly growing fleet.

Kenya Airways now has 13 of these mid-sized craft ideal for the regional routes the airline is busy adding to its schedule.

With fastjet looking to open more routes in Kenya, Angola, Ghana and possibly South Africa, and with 'tailor-made for Africa' craft like those of Embraer entering service with more airlines, air travel in the continent has never seemed in better health.

With intra-African road and rail networks in such a dire state, cheap and convenient air travel is the best option for the increasing number of passengers and cargo seeking transport.

But look underneath the surface and a very different picture emerges. The majority of African airlines are in deep crisis.

During an aviation summit held in Maputo, Mozambique, in December, speaker after speaker in the industry warned that unless something was done soon, most African airlines would lose their wings permanently.

The problem is that despite signing up to the Yamoussoukro Decision in 1999 to open up their skies to all African airlines, only a tiny handful of countries have done so.

"The only alternative to liberalisation of the African airspace is the end of most African airlines," Raphael Kuuchi, commercial director of the African Airlines Association (AFRAA), told me.

Even at the best of times, the airlines business is a precarious one and competition is nakedly ruthless. Over the past 10 years, African airlines have lost 16% capacity for intercontinental routes to non-African competitors, who now control 80% of the traffic.

This includes the Middle East Johnny-come-latelys such as Emirates and Qatar, who have sliced up 24% of the market, growing at 125% over the period.

In this game, big and strong is beautiful but with the exception of carriers such as South African Airways, Kenya Airways and Ethiopian Airlines, most of the other African airlines are only just keeping above ground if they have not already crashed. …