African airlines lose $6bn in revenue
AFRICA GOVERNMENTS WOULD HAVE to choose between a continent without airlines and a deliberate measure to bail out their airlines, as the International Air Transport Association (IATA) warns that African airlines face clear existential challenge...
AFRICA GOVERN MENTS WOULD HAVE to choose between a continent without airlines and a deliberate measure to bail out their airlines, as the International Air Transport Association (IATA) warns that African airlines face clear existential challenge.
According to IATA, airlines in Africa have lost revenue of about $6 billion, $3.1 billion job losses in aviation and related industries and loss in Gross Domestic Product (GDP) of $28 billion attributed to the devastating effects of COVID-19.
Muhammad Ali Albakri, IATA’s vice president, Africa and Middle East, said the continent’s carriers are currently battling for survival, stressing that already, Air Mauritius has entered voluntary administration, South African Airways and SA Express are in business rescue.
He noted that other distressed carriers have placed staff on unpaid leave or signalled their intention to cut jobs.
In the Middle East, he said Etihad Airways, Qatar, Emirates have all confirmed that they have forced to make redundancies because of the economic crisis caused by the Covid-19.
In the Middle East, Albakri puts airline revenue loss at $24 billion, job losses in aviation and related industries at $1.2 million and loss in GDP supported by aviation at $66 billion.
He stated that the main priority is to secure relief for industry through government engagement across the region through direct financial support, loans, loan guarantees and support for the corporate bond market.
Others, he said are reduction, waiver or deferral of government-imposed taxes and fees.
As part of relief measures, Al Bakri disclosed that Senegal announced $128 million in relief for the Tourism and Air Transport sector,.
He said, “We have seen some additional support for the air transport sector in terms of direct corporate and industry tax relief. The Countries include Angola, Botswana, Chad, Egypt, Cote D’ Ivoire, Ghana, Jordan, Kenya, Morocco, Oman, Qatar, Saudi, Senegal, South Africa, Tunisia, UAE”.
“We have also seen a number of relief measures in terms of Airport and ANSP charges from ASECNA (ANSP covering 17 states in Central West Africa and Madagascar), Namibia Airports Company (8 airports), Ghana Airport Company (6 airports), Seychelles, Oman airports, AMM airport, DXB & DWC airports”.
He noted that in a further request for help for African airlines, five international air transport and tourism bodies launched an appeal to international financial institutions, country development partners and international donors to support Africa’s Travel & Tourism sector.
The major stimulus from governments combined with liquidity injections by central banks, he said would boost the economic recovery once the pandemic is under control.
“Almost every challenge in aviation requires a team effort to solve it. Today we face the biggest challenge in commercial aviation’s history: Restarting an industry that largely has ceased to operate across borders, while ensuring that it is not a meaningful vector for the spread of COVID-19”, he said.