Airlines hit by commodity price fall

> Leonard Ncube

VICTORIA FALLS-AIRLINES, big and small, from across the African continent met in Zimbabwe this week for the 48th Africa Airlines Association (AFRAA) Annual General Assembly which sought to deliberate on challenges facing the aviation industry.

Among the major challenges discussed were difficulties in repatriating funds from countries of operation and a lack of political will by governments to liberalise the airspace in fulfilment of the Yamoussoukro Decision which African nations agreed on.

Close to 600 representatives of airlines and aviation companies took part in the three day summit which ended Wednesday. It was held under the theme: “Managing survival and market recovery of African airlines.”

AFRAA secretary general Elijah Chingosho said the 48th session was the biggest so far in terms of attendance and content.

“We had 557 delegates at this year’s conference making it the biggest so far. This is a summit where airline chief executives meet and deliberate on how airlines can regain the market share where African airlines only constitute 20 percent of traffic,” said Chingosho.

Airlines in Africa have been greatly affected by falling oil prices and travel budget cuts by governments.

Chingosho said among some of the major challenges, “airlines are failing to access their revenue which is locked in countries where tickets are sold.”

“Airlines should be allowed to access their money so they facilitate trade and tourism,” he added.

Airlines price and sell tickets in local currency of the country they are departing from or flying to, and due to a drop in oil and other commodity prices, some African governments are experiencing foreign exchange challenges resulting in some airlines failing to convert revenue into their operational budget.

Chingosho said only 15 countries had showed interest in liberalising the airspace and these constitute 75 percent of air traffic in Africa.

Some of the countries include Egypt, Ethiopia, Kenya, Nigeria, South Africa, Rwanda, Zimbabwe, Botswana and Ivory Coast which adopted the policy a few years ago while Benin, Ghana, Namibia and Sierra Leon recently adopted it.

Airlines, which are seeking partnerships with bigger players, also want governments to prioritise the aviation sector in foreign currency allocation as well as support measures to recover blocked funds.

Zimbabwe was president of AFRAA through its national carrier, Air Zimbabwe, and the post has been taken over by RwandAir which will hold it throughout 2017.

November 2016
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