Four African airlines cease operations

Four airlines across Africa have ceased operations due to the impact of Covid-19 and two are in voluntary administration, with many more in serious financial distress expected to fold without committed relief.

This is according to the International Air Transport Association (IATA), which said in a statement on Wednesday last week that without urgent financial relief more carriers and their employees were at risk, as was the wider African air transport industry, which supports about 7.7 million jobs on the continent.

IATA’s regional vice president for Africa and the Middle East, Muhammad Albakri said the risk of a “jobs bloodbath” was not just in aviation but across industries that depended on efficient global connectivity.

“Much needed financial relief has been pledged, but little has materialised. The situation is critical. Governments and donor organisations need to act fast or the challenge will move from supporting an industry in severe distress to resurrection from bankruptcy,” noted Albakri.

The governments of Rwanda, Senegal, Côte D’Ivoire and Burkina Faso have pledged a total of $311 million (about R5 billion) in direct financial support to air transport.

A further $30bn has been promised by some governments, international finance bodies and other institutions including the African Development Bank, African Export Import Bank, African Union and the International Monetary Fund (IMF) for air transport and tourism.

However, most of this relief is yet reach those in need.

IATA revised its 2020 passenger traffic forecast down for Africa, saying that forward bookings for air travel in the fourth quarter showed that the recovery continued to falter.

The association said while domestic travel was picking up across Africa as countries re-opened their borders, international travel remained heavily constrained as major markets including the EU remained closed to citizens of African nations. “Residents from only two African countries – Rwanda and Tunisia – are permitted to enter EU borders.”

Albakri said the further fall in passenger traffic in 2020 was more bad news for the aviation industry in Africa.

“A few months ago, we thought that demand reaching 45 percent across the continent in 2020 compared to 2019 was as grim as it could get. But with international travel remaining virtually non-existent and a slower-than-expected pick-up in domestic travel, we have revised our expectations downward to 30 percent.”

IATA expects full-year 2020 passenger numbers in Africa to reach only 30 percent of 2019 levels, down significantly from the 45 percent that was projected in July. In absolute numbers, the region is expected to see about 45 million travellers in 2020 compared to the 155 million in 2019.

The association said in 2021, demand was expected to strengthen to 45 percent of 2019 levels to reach close to 70 million travellers to/from/within the region. A full return to 2019 levels is not expected until late 2023. -BusinessReport