Liberalisation dawns in Africa

Liberalisation dawns in Africa

This will be an important year for Africa as it abolishes an era of protectionism and embraces liberalization with the implementation of the Single African Air Transport Market (SAATM), whilst the African Continental Free Trade Area will create the largest economic zone for African countries to trade with each other, as never before, propelling aviation growth within the continent.

Foreign airlines, which control 80% of the air cargo volumes to and from Africa, will have to increase their co-operation with African carriers, while a new era of co-operation amongst African airlines will benefit the aviation sector, and will result in improved accessibility and connectivity to the most fragmented continent in the world.

I attended the 5th Air Cargo Africa event in Johannesburg, South Africa, in February, where Vuyani Jarana, Chief Executive officer (CEO) – South African Airlines, said that increasing air cargo traffic within Africa would require airport infrastructure development. Moreover, air traffic charges and levies should be set to promote air traffic – excessive charges and levies serve to discourage air traffic and could make some routes uneconomic to operate.

Turkish Airlines has seen a 45% growth into and out of Africa, and hopes to be in the top five carriers in Africa by 2020, and Saudia Cargo, meanwhile, is developing a hub and spoke network from Jeddah to serve Africa.

While the importance of regional integration and co-operation was echoed by the Kenya Airways Head of Cargo, Mr Dick Murianki, the implementation of SAATM (Single African Air Transport Market) and the adoption of the African Continent Free Trade Area, will be game-changers for the dark-continent according to a statement that was made by myself.

On e-commerce, Fitsum Abadi, Managing Director of Ethiopian Cargo, said: “e-commerce will be the future in Africa, the middle class is slowly growing. But integrated logistics services will definitely be a challenge. Air connectivity is very important, but we need to connect land and sea too.”

Later in the month, I was present at the 4th Aviation Africa 2019 Summit and Exhibition in Kigali where the president of Rwanda, Paul Kagame, told delegates that protectionism is a short-sighted policy that serves only to keep the African market fragmented, inefficient, and expensive – thereby reducing opportunities for African firms.

“Regional integration has seen some notable achievements over the past year, chief among which is the SAATM,” said president Kagame. “However, the full promise of this pact only becomes apparent in the wider context of the African Continental Free Trade Area and the protocol of the Free Movement of persons, which were also signed last year.”

“Now is the time to reconsider how Africa’s aviation market is positioned in order to maximize its full potential.

“Governments should leave behind protectionist approaches to regulating aviation and embrace liberalization, because when such policies are adopted, countries benefit from improved connectivity and a positive impact on trade, tourism, and employment,” said Akbar Al Baker, Chairman of the international Air Transport Association (IATA) Board of Governors and the CEO of Qatar Airways.

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