Protectionism: Short sighted policy for Africa’s aviation market

With protectionism constricting air traffic growth in Africa, WOLE SHADARE calls for capacity development to increase the market share of air transport in the continent

Protectionism in aviation, particularly to airline business is the practice of shielding a country’s domestic industries from foreign competition by taxing imports’.

Aviation protectionism is simply preventing other airlines from operating into a country. This is principally due to the fact that the governments want to protect their national carriers, which doesn’t give room to competition; variety of products and it is against the open skies principles.

It rather breeds inefficiency, monopolies and outright failure to provide the consumer (travellers) with various choices to decide.

Such protectionism is mostly carried out by local government authorities through regulations, denial letters and outright verbal refusals out of malicious and egocentric tendencies sometimes due to lack of full knowledge and understanding of the impact of such decisions to the interest of the state and its people.

 

A rethink

Experts in the aviation sector charged government officials within the aviation sector to seriously consider this in order to encourage economic growth in Africa.

Nowhere in the world are these obstacles greater than the African skies. In Africa, only 20 per cent of those crossing national borders arrive by air, with the percentage much higher in advanced and developed countries.

Over the next decade, most studies and estimates suggest that the travel industry will double its already sizable contribution to Africa’s economic growth especially as Africa continuous to sign trade partnership deals with China and Europe.

Despite the very strong protectionism, we are all witnesses to the short life span of most of the African national carriers with an average life cycle of five years maximum.

Survival

Those that succeed to cross the five years period survive due to permanent injection of huge sums of money in the guise of subventions at the detriment of tax payers or better still there survival due to political insistence of regimes for the drive to have the flag of the nation fly above despite the huge debts it incurs and the operational inefficiency and risks at stake.

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Protectionism has led to the death of many promising African airlines because their owners, which are governments, made it very impossible to allow the carriers to compete with big international airlines.

For instance, Virgin Nigeria Airways transmuted to Nigeria Eagles Airlines to Air Nigeria for Nigeria, Tourmai Air Tchad – disappeared and has never been replaced, for Tchad.

Air Gabon to Air Gabon International (Gabon Airlines) for Gabon

Cameroon Airlines (Camair) to Cameroon Airlines Cooperation ( Camair-co) for Cameroon Air Ivoire to Air Cote D’Ivoire for Ivory Coast

Air Senegal to Air Senegal International to Senegal International to Senegal Airlines and now back to Air Senegal again, for Senegal. Ghana Airways to Ghana International Airlines (GIA) for Ghana. DTA (Divisao Los Transportes Aereos) to TAAG (Transportes de Angola) Angola Airlines for Angola.Egypt Air to MisrAir to United Arab Airlines (UAA) and back to Egypt Air for Egypt Compagnie Aerienne du Mali to Air Mail for Mail.

Nothing to protect

For African carriers, the question is, what are we really protecting? We prevent and refuse market access to partner regional African carriers into our markets that will provide complimentary services and alternatives to the travel population, with the message of protecting local national carriers that cannot fully satisfy demand. If all governments within Africa prevent other regional carriers from not having access into their market, will each carrier stay within its sovereign territory and function within? These are some of the reasons why the Yamoussoukro Decision famously known as the YD declaration was enacted in 1999 and only 44 African states where signatory to this multilateral agreement. And despite their signatures together with those who didn’t ratify this agreement continue to find ways of arguing that each state has its sovereignty and can still decide on which carrier comes in or not.

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Experts’ views

Speaking at the just concluded Aviation Africa summit in Kigali, Rwanda, Rwandan President, Paul Kagame stated that protectionism is a short-sighted policy, which only serves to keep the African market fragmented, inefficient, and expensive – thereby reducing opportunities for African firms.
His words, “One industry analysis has calculated the requirement for new aircraft in Africa over the coming generation at more than 1000 aircraft with a value exceeding $150 billion dollars,” said President Kagame.

“That means there will be many more high-quality jobs for African pilots, engineers, and service personnel, to operate and maintain this equipment professionally, and above all, safely.

“Sixteen countries in Africa are landlocked; including Rwanda – that is almost one-third of Africa – but every country is air-linked. So, geography should not be seen as an excuse for underdevelopment. This highlights the importance of regional integration where there have been some notable achievements over the past year, chief among these is the Single African Air Transport Market.

“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”.
He stated that it is therefore important to attract more countries to join the Single African Air Transport Market, and to fully implement its provisions.

Another aviation expert, who preferred anonymity, said when competition is prevented, it helps to breed inefficiency that leads to unproductivity, poor customer service, operational deficiency and high costs, which are unbearable.

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“As Africans, we need to open up our skies especially to African regional carriers. The International Air Transport Association – IATA together with Inter VISTAS did recently carried out extensive studies illustrating the importance and advantages of liberalizing Africa’s skies”.
The United States, European Union and the Gulf region all practice open skies. The consortium of gulf carriers (Emirates, Qatar, Etihad) can freely operate into and out of any one point within the USA. European Union carriers (Lufthansa, Air France – KLM, Brussels Airlines, British airways, Virgin Atlantic, Easy Jet etc.) can fly into any points within the European Union.

Africa’s problem

In Africa we fight to protect what we don’t even have, we fight to protect what we didn’t create, we fight to protect innovations and inventions that are not our concepts.

By this protectionism Africa prevent its own home businesses from thriving and willingly refuse opportunities to our people. A few persons said, “When we copy, why don’t we copy the right things”? The airline business is a very heavy capital-intensive activity that mostly governments venture into it. Except for very few world-class individuals such as Richard Branson and Warren Buffet with very big hearts, not many venture into it.

Last line
The aviation industry is a very peculiar industry and the few countries/governments and individuals that have come to really understand how it functions, have without any reservations, wholeheartedly opened up their skies for new entrance and competition. Some have gone as far as opening up even to ‘Cabotage’.

 

Wole Shadare