Global aviation industry leaders continue to perceive Africa as a “volatile region” with only a handful of strong airlines, but there is optimism that the market will improve and develop, albeit at a slow pace.
This was one of the key conclusions in the recent KPMG Aviation Industry Leaders Report 2018 which followed four months of interviews with airlines, lessors and aviation financiers.
One of the authors of the report and a partner at KPMG, Tom Woods, pointed out that African airlines faced many challenges - a lack of attention and vision from government, higher oil prices due to taxation, the high cost of transport which also impacts fares, and a lack of continental aviation policy coordination. Ethiopian Airlines group CEO, Tewolde GebreMariam, agreed. He said that many African governments did not properly understand the contribution the aviation industry could make to growing the economy.
“Africa is such a vast land mass – how else are Africans expected to travel from one country to the other to do business or carry goods? The reality is that aviation is an essential public service, but it is still not seen that way, which means infrastructure has not developed up to international standards simply because it is at the bottom of the priority list,” he said.
Shamini Law, CEO of the Malaysian-based flyGlobal Charter, believes that the region is still the next big area of opportunity: “For pioneering airline operators we would also include Iran, Iraq and Pakistan. But Africa is where the future lies, if you are looking for an interesting, long-term growth story,” he said.
Mark Lapidus, CEO of airline lease company, Amedeo, agreed, pointing out that it would be “amazing if African countries found a way of not being nationalistic about it”.
