Industry leaders gathered at WTM Africa to discuss the Single African Air Transport Market (SAATM), where they acknowledged the significant benefits to be gained from the agreement while unpacking the major roadblocks that are hindering its progress.
There is broad agreement on the benefits of improving Africa’s air access, which includes facilitating trade and tourism growth and the many benefits they both carry. David King, Project Manager: Cape Town Air Access, said that for every 100 tourists arriving on a plane in Cape Town, one job is created. “Every flight that enters your airport is valuable and grows the economy,” he added.
For every 100 tourists arriving on a plane in Cape Town, one job is created.
Afzal Parambil, regional manager Southern Africa at Emirates, said that the SAATM would help all airlines, not just African carriers. This is because opening up borders helps connect passengers to secondary and tertiary destinations in Africa, which is currently a significant challenge.
He added that liberalisation had enabled Emirates and Dubai to establish a strong hub-and-spoke model, which allowed Emirates to expand its operations and become one of the world’s leading airlines.
What’s hampering SAATM’s progress
However, despite the benefits to be had, there are several obstacles blocking the progress of SAATM, including visa restrictions, exorbitant costs, and protectionism. Until these issues are effectively addressed, airlines will not be able to achieve the required load factors to make their routes financially viable, rendering the benefits of open skies irrelevant.
Adebayo Adedeji, CEO of Wakanow.com, added that airlines need at least an 80% load factor to continue operations. Without being able to achieve this on certain routes, many airlines have simply been forced to close these routes.
Airlines need at least an 80% load factor to continue operations.
Rui Carreira, non-executive Board member of TAAG Angola Airlines, explained that the African Union elected the African Civil Aviation Commission (AFCAC) as the executing agency of SAATM. However, AFCAC currently lacks the power to enforce regulations, which poses a challenge to the implementation of SAATM.
AFCAC can only rely on voluntary compliance by airlines and national authorities, explained Carreira. This has resulted in an uneven implementation of SAATM across different countries, as some have fully embraced liberalisation while others are hesitant to do so. The result is an uneven playing field for airlines and limited investor confidence.
Local African currencies are another obstacle to open skies because multiple currencies and exchange rates can create added complexity and costs for airlines that operate across multiple countries, added Carreira.
King also pointed out that visa accessibility is another massive challenge. Although visa controls are necessary, the process should be easy and seamless. The lack of visa accessibility is currently preventing airlines from attracting passengers, which in turn hinders the development of SAATM.
A possible solution
To achieve open skies in Africa, it’s imperative that these various obstacles are addressed so that airlines can connect African countries and passengers to their destinations and grow the region as a powerful aviation hub.
Carreira suggested that Africa should follow the example of the European Union; “The EU started as an economic community of just six countries, and gradually expanded over time to include more member states. The region also developed a common market and customs union, which have helped to eliminate trade barriers and promote economic growth within the region.”
Carreira pointed out that similarly to the EU, African countries can start small and focus on building economic partnerships and regional integration at a smaller scale before scaling up. African countries could also benefit from developing institutions to promote intra-regional trade and economic cooperation.
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