Huge losses expected for SADC airlines

South Africa’s carriers are
expected to incur losses of
about US$100 million this
year, taking the lion’s share
of the projected combined
US$350-million loss for
the Southern African
Development Community
(SADC).
So said Chris Zwiegenthal,
CEO of the Airlines
Association of Southern Africa
(Aasa), at Aasa’s 47th annual
general assembly held last
week at the Wild Coast Sun in
the Eastern Cape.
He said the latest figures
issued by the International Air
Transport Association (Iata)
highlighted that while the
entire global aviation industry
would see a US$31-billion net
profit for 2017, African airlines
were set for a repeat of the
2016 trend, returning losses of
around US$800 million for
the year.
He pointed out that across
the continent, but particularly
in southern Africa, the
aviation industry continued
to be characterised by intense
competition with a number
of players increasing their
footprint.
Zwiegenthal highlighted
several factors that
impacted on the
industry’s ability to
grow, develop and
compete on the global
aviation stage, including
African governments’
failure to reform market
access – whether it was
through the Yamoussoukro
Decision or the African
Union’s commitment to
establish a single common
African aviation market.
He added that the
airlines also faced high US
dollar-driven operating
costs and that revenues
earned in some countries
were being withheld and
access to them blocked by
governments that were
attempting to hoard foreign
exchange reserves.