Aviation sector to lead African growth?

The International Air Transport Association (IATA) has called on Africa’s governments to take advantage of the continent’s emerging aviation sector in order to stimulate wider economic and social development

According to the organisation, which represents around 330 airlines, Africa’s airlines are forecast to earn a collective net profit in 2024 of around US$100mn. While this translates into just 90 cents per passenger (below the global average of US$6.14), it can be seen as a success in light of the post-Covid environment and global instability that has coloured the operating environment over the last few years.

“Africa’s airlines are making a collective profit. That is good news. But it is razor-thin and well below the global benchmark. And there are wide variations across the continent where many individual airlines still struggle with losses,” commented Kamil Al-Awadhi, IATA’s regional vice president for Africa and the Middle East. “The demand to travel is there. To meet it, the African airline sector needs to overcome many challenges, not least of which are infrastructure deficiencies, high costs, onerous taxation, and the failure to broadly implement a continent-wide multilateral traffic rights regime. The challenges facing African aviation are significant, but they are not insurmountable.”

To help the continent do so, and realise it’s the enormous aviation potential, IATA has laid out the Focus Africa initiative – a collaborative strategy pooling together the resources from the aviation value chain and build partnerships within countries to meet clear and measurable objectives. It is focused on addressing key challenges and opportunities within the continent’s aviation sector, emphasising six priority areas in the form of Safety, Infrastructure, Connectivity, Finance and Distribution, Sustainability and Future Skills.

“IATA’s Focus Africa initiative is by no means a panacea, but it does lay out a framework to build a stronger aviation sector that will provide even better support to economic growth and social development,” explained Al-Awadhi. “The potential for aviation in Africa is huge. It has 17% of the world’s population yet only contributes about 2% of total global travel. While there are hurdles to overcome, through collaborative initiatives like Focus Africa with our partners including AFCAC, AFRAA and AASA we are addressing critical challenges hindering the advancement of aviation across Africa. Our goal is a safer, more efficient, and better-connected continent, driven by a diverse, skilled workforce to unleash aviation’s potential and unlock the economic and social opportunities.”

South Africa’s SAF opportunity

While encouraging the development of the aviation industry across the continent, IATA also singled out policy makers in South Africa by recognising an opportunity distinct to the country.

As government and industry officials gathered in Johannesburg for the IATA Wings of Change Focus Africa conference, the organisation called for the country to accelerate the development of Sustainable Aviation Fuel (SAF) production.

“South Africa has vast potential to become a leading SAF producer in the region. And there is a waiting market for SAF as airlines work to achieve net zero carbon emissions by 2050,” stated Marie Owens Thomsen, IATA’s senior vice president for sustainability and chief economist. “More than a strategy in support of aviation’s decarbonisation, it is a strategy for economic development and should be a top priority for the new South African government. Across agriculture, energy, and transportation, new jobs and industries are waiting to be created that would not only help fight poverty but also contribute to greater energy independence.

“Airlines are ready and waiting to purchase SAF as evidenced by the fact that every drop of SAF produced has been purchased and used. But the production volumes are a minute fraction of what aviation needs. That’s why it is essential for governments of countries with production potential, such as South Africa, to embrace what is a unique win-win-win opportunity for economic development, energy transition, and decarbonised air transportation.”

IATA is not the only entity to call for decision makers on the continent to get ahead of the forthcoming SAF surge; Omar Ali Adib of Rolls-Royce also provided this opinion in a recent article published on Africa Review. Discover why the senior vice president believes Africa could become home to a “world-leading” biofuel sector at: https://africanreview.com/transport-a-logistics/africa-s-sustainable-aviation-fuel-opportunity