COVID-19: What the future holds for Africa’s aviation industry
The International Air Transport Association, IATA, says 2020 will be the worst year for airlines as the industry is expected to post an $84.3 billion net loss. In Africa, IATA notes that the region was the weakest pre-COVID-19 crisis and that the pandemic has added to an already challenging operating environment. Adefunke Adeyemi, Regional Director, Advocacy and Strategic Relations for Africa at IATA joins CNBC Africa to discuss what the future holds for Africa’s air transport.
Thu, 25 Jun 2020 15:02:08 GMT
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AI Generated Summary
- IATA forecasts $84.3 billion net loss for global airlines in 2020, exacerbating challenges in Africa's pre-existing weak aviation sector
- Aviation industry in Africa faces $6 billion revenue loss and 3.1 million at-risk jobs due to pandemic
- Implementation of biosecurity measures, government bailouts, and consumer awareness campaigns crucial for industry recovery and restoration of passenger confidence
The International Air Transport Association (IATA) has predicted that 2020 will go down in history as the worst year for airlines worldwide, with an estimated net loss of $84.3 billion. For Africa, a region already facing challenges pre-COVID-19, the pandemic has only exacerbated the situation. Adefunke Adeyemi, Regional Director of Advocacy and Strategic Relations for Africa at IATA, shed light on the current state and future prospects of Africa's aviation sector. Adeyemi highlighted the devastating impact of the pandemic on the industry, stressing that aviation, which previously contributed $55.8 billion to Africa's GDP and supported 6.2 million jobs, has seen a significant decline. The GDP contribution has plummeted to $28.5 billion, putting 3.1 million jobs at risk, over half of the workforce directly or indirectly supported by the aviation sector. Airlines are projected to lose approximately $6 billion in revenue compared to the previous year as flights were grounded due to border closures, with only essential services, cargo, and repatriation flights operational. Adeyemi emphasized the critical importance of restoring passenger and government confidence in air travel, as COVID-19 is expected to persist in the foreseeable future. Recognizing that aviation must adapt to coexist with the virus, IATA has collaborated with various stakeholders to develop biosecurity measures for safe travel. These measures, encapsulated in the 'Takeoff' document, address operational standards, passenger journey, demand stimulation, and incentives to ensure a coordinated global approach. Adeyemi urged Nigeria and other African countries to implement these international standards to create a seamless and safe travel experience. Governments across Africa have been called upon to provide financial support to the aviation sector through bailouts, tax relief, and loan guarantees. Adeyemi commended the African Union, the African Export-Import Bank, and the African Development Bank for pledging billions to aid in the recovery effort, although the estimated bailouts needed exceed $30 billion for African airlines. Despite the challenges, Adeyemi remains optimistic about the aviation industry's role in Africa's development, citing its potential as a technology leapfrog and economic catalyst. She emphasized the importance of regional cooperation and the implementation of policy initiatives like the Single African Air Transport Market and the African Continental Free Trade Agreement. Adeyemi assured that enhanced safety measures in airports and aircraft, combined with public awareness campaigns, would help restore consumer confidence in air travel. Early indications from countries that have resumed domestic operations show up to 70% of pre-COVID passenger levels, signaling a gradual return to normalcy in the aviation sector.