Is opening up Africa’s airspace a mirage?

WOLE SHADARE writes that it is often more convenient and faster to fly from a city in West Africa via London, Paris and back to a neighbouring city in West Africa, than to travel direct

While many air markets between Africa and countries outside of Africa have been liberalised to a significant extent, most intra-African aviation markets remain largely closed due to restrictive bilateral agreements, which limit the growth and development of air services.

This has limited the potentials for aviation to be an engine of growth and development. Not a few believe that aviation has the potential to make an important contribution to economic growth and development within Africa.

Connectivity, time saving for passengers

The potential passenger benefits of liberalisation come not just from fare reductions.

This can also result in saving time for passengers (fast direct services rather than time-consuming connecting itineraries) and greater convenience (a greater choice of departure times). Enhancing air connectivity can help raise productivity, by encouraging investment and innovation, improving business operations and efficiency.

To analysts, air transport is indispensable for tourism, where convenient air service facilitates the arrival of larger number of tourists to a region or country. Interconnectivity and liberalisation are interwoven; a situation that made head of governments in the continent to push for a declaration that for air transport to grow and for African airlines to benefit from passenger traffic in the continent, they must implement the Yamoussoukro Decision (YD),

which is the opening up of Africa airspace for African airlines, a Declaration initiated in 1998 and ratified by countries in the region in 1999.

In 1999, the YD was adopted out of recognition that the strict regulatory protection that sustains national carriers has detrimental effects on air safety records, while inflating airfares and dampening air traffic growth.

It followed up on the Yamoussoukro Declaration of 1988, in which many of the same countries agreed to principles of air services liberalisation. The Decision commits its 44 signatory countries to liberalisation.

To bring this to fruition, African airlines had to work together and this would be enhanced by the open skies treaty in order to curb the incursion of non-African mega carriers from the Gulf states, Europe and the US, which presently have 80 per cent of the market, while African airlines only have 20 per cent of the traffic in the region, down from 60 per cent control about 20 years ago. Unfortunately, many African countries have refused to implement this agreement. Only 11 out of 54 counties have complied with implementation scheduled to begin in 2017.

Protectionist policies

The desire by each country to have a national airline and the absence of a mechanism to form and jointly own airlines on the continent is a major impediment to liberalisation.

A number of countries continue to restrict market access under the pretext that their national airline is not ready to compete in a liberalised market.

Other countries insist that non-local airlines pay royalties for the privilege of using additional frequencies beyond what is allowed under the Bilateral Air Services Agreement (BASA). Improved connectivity can offer considerable time savings and convenience for passengers.

For example, in 2013 there was no direct service between Algeria and Nigeria. The most convenient routing available was via Morocco (Algiers-Casablanca-Lagos).

The minimum journey time for this routing is nine hours, but depending on connecting times could be as much as 17 hours (no more than two daily frequencies were operated between Casablanca and either Algiers or Lagos).

A direct service would reduce the travel time between Algiers and Lagos to approximately four to five hours. For smaller cities and secondary airports, the potential time savings are even greater. For example, to fly from Oran (Algeria) to Kano (Nigeria) would currently involve a 14- 23 hour two-stop itinerary.

With an Algiers-Lagos service in place, the connecting itinerary could be reduced to around 8-10 hours. If a direct service between Oran and Kano could be sustained, the flying time would be reduced to approximately by four hours.

It would be recalled that Africa’s air transport sector has suffered from more than just high prices and unprofitable routes — safety and reliability are also significant issues for operators.

Africa’s aircraft hull loss accident rate is more than six times higher than those of Asia and Latin America, and more than 12 times higher than those of Europe and North America.

Benefits of intra-African liberalisation.

In addition to the direct benefits to users, the increase in air service and traffic is forecast to stimulate employment and economic growth in a number of ways.

For tourism sector, air service facilitates the arrival of larger numbers of tourists to a country; this includes business as well as leisure tourists. The spending of these tourists can support a wide range of tourism-related businesses: hotels, restaurants, theatres, car rentals, etc.

Total impact

Across 12 countries, such as Algeria, Egypt, Ethiopia, Ghana, Kenya, Namibia, Nigeria, Senegal, South Africa, Tunisia and Uganda, liberalisation is projected to generate 155,100 jobs and nearly $1.3 billion in Gross Domestic Product (GDP) according to Intervistas Consulting, a firm engaged by the International Air Transport Association (IATA) to undertake a study to examine the impacts of liberalising intra-African air markets. It says that the largest employment is in Uganda (18,600 jobs), followed by Nigeria, Kenya, Angola, and Ethiopia.

In absolute terms, South Africa is projected to have the largest GDP increase ($283.9 million) but in percentage terms, the largest impact is in Namibia (0.56 per cent of GDP), followed by Uganda, Senegal, Angola, and Tunisia.

Expert’s perspective

The Chief Executive Officer (CEO) of Ethiopian Airlines, Tewolde Gebremariam lamented, “Today non-African airlines have 80 per cent of the traffic of the intercontinental air travel from the continent; yet the region gains nothing from the domination of these mega carriers.

“Twenty years ago, the combined African airlines market was more than 60 per cent of the intercontinental traffic between Africa and the rest of the world.

Back then, there were airlines as big as Air Afrique, Ghana Airways, Nigeria Airways, the Democratic Republic of Congo (DRC) owned airline. The DRC today doesn’t have an airline, but the DRC then had an airline operating more than 30 jet airplanes. They all died because there is was support from their governments”.

Gebremariam said that before the regional airline, Asky was established in West Africa; it was difficult to travel from one country to the nearest one by air, so, a traveller who wished to travel to Togo from Ivory Coast would have to go to Paris first, from there he would connect flight to Togo.

Conclusion

Despite the trend towards liberalisation, there remain considerable government restrictions on airline operations and ownership. Many bilaterals still follow the constrictive Bermuda model established over 50 years ago and most governments still apply restrictions on the ownership and control of airlines.

Wole Shadare