By Chizi-Boms Akachim Mattins[1]
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Introduction
The COVID-19 disease is a current global health pandemic that started as a result of the spread of the deadly novel Coronavirus known as Sars Cov 2. Sars Cov 2, also known as Severe Acute Respiratory Syndrome Corona Virus 2 is the strain of corona virus that causes respiratory illness which can be transmitted directly from one human to another via respiratory droplets or indirectly when contact is made with contaminated surfaces.[2] The viral outbreak was first reported in Wuhan, China in December 2019 and has since spread to more than 180 countries resulting in over 5 million infections and more than 335,000 deaths as of May, 2020.[3] The pandemic has led to a global disruption in economy, education, transportation. It has also resulted in the postponement/cancellation of entertainment activities and the suspension of cultural and religious activities as well. As countries have imposed a lockdown to prevent/slowdown the further spread of the virus in their territories, it has affected the aviation industry greatly and quite extensively as air travels have also been suspended worldwide to reduce the spread of the coronavirus across territories, countries and continents. This study will discuss how the aviation industry, in Africa, has been affected by the pandemic and what can be done to restore it once the pandemic has been contained.
The Aviation Industry and the World Economy with Specific Reference to Africa
The aviation industry has played an important role in the transportation of people and cargo over long distances. According to statistics, in the year 2018 more than 4 billion passengers (up-to half of the Earth’s population) were carried on scheduled services to different destinations while 62.5 million tonnes of cargo were transported.[4] While more people are transported by air more than any other mode of transportation, only 0.5 percent of international cargo is transported by air and at the same time such percentage represents 30% of the total worldwide shipment value.[5] It is evident that the aviation industry has played an important role in sustaining the global economy. The spread of the coronavirus has seen large scale disruption in air travel and transportation, with particular effect on airlines. The suspension of flights have resulted in a number of disadvantages for airlines, international carriers and aviation hubs as well.
Air transport in Africa makes up about 2.1 percent of world traffic which is the lowest when compared to other continents.[6] The industry has sustained up-to 6 million jobs and contributes about $55-80 billion in GDP in Africa in 2019.[7] The International Civil Aviation Organisation (ICAO) indicated that up to 55 million passengers were flown in sub-Saharan Africa in the year 2018.[8] Recent years have witnessed an increase in the number of passengers flown and cargo transported.[9] African airlines, however, have little presence in global air travels with Ethiopian Airlines being the only African airline with a fleet of over 100 aircrafts. The airline is the largest in Africa followed by Egypt Air and others.[10] The exponential growth of the aviation industry in Africa has been hindered by a number of factors including corruption, financial mismanagement, safety issues, and lack of state-of-the-art infrastructure, among others. It is without doubt that if these issues were non-existent, the growth of aviation in Africa would be more than the reported 4% annual growth. It is important, however, to state that despite the underlying problems faced, efforts have been made in recent times to improve the aviation sector in order to generate higher revenue, cater for increasing number of tourists, expats, etc.
How the COVID-19 Pandemic has affected Aviation in Africa
The Covid-19 pandemic has caused a global and economic recession. A lot of industries and sectors suspended activities as a measure to reduce the spread of the virus. The aviation industry was no different. It is evident that the outbreak of the COVID-19 pandemic has posed a serious threat to the growth and development of the aviation industry in Africa. Since flights have been suspended, most airport workers have also been affected including air traffic controllers, other airport staffs such as cleaners, airport taxis, etc. With the suspension of air travel all over the continent, African airlines, including those that are struggling to stay alive, are beginning to accumulate huge losses in revenue and jobs. The struggle for survival is evident. A number of airlines are seeking business/financial rescue, Air Mauritius has entered voluntary administration, and South African Airways is on the brink of collapse.[11] It should be noted here that South African Airways had already been experiencing financial difficulties and had been relying on loans to keep its operations alive before the pandemic started. Since the company had recently stopped yielding enough profit to sustain itself, it began delving into bankruptcy protection to prevent it from collapse.[12] One might ask how the pandemic affected an airline that is almost bankrupt. The answer stems from the fact that with the suspension of air travel as a result of the pandemic, the airline ran into new financial difficulties and therefore needed emergency financial rescue from the South African government which was declined. As a result the South African government resolved that it would no more fund the airline. With already existing financial difficulties and bankruptcy, corruption allegations, the airline’s window of rescue was closing. The COVID-19 added to the airline’s woes leading the airline to resort to only repatriation flights.
A number of other carriers have placed their staffs on unpaid leave and have reported cutting jobs to keep themselves afloat.[13] It is important to understand if and how most African airlines will survive the effects caused by this pandemic or whether they will succumb to it. Invariably, most airlines will survive but will have to put in a lot of effort to address the financial difficulties they would have incurred. Stemming from the fact that all passenger flights have been cancelled, some airlines including Ethiopian Airlines, RwandAir, Air Peace, Kenyan Airways, have resorted to repatriation and cargo flights[14] (mostly involving transportation of medical supplies, relief materials, food and others) to keep operations afloat.
According to IATA,[15] based on severe travel restrictions, African airlines could accumulate a loss of $6 billion in terms of passenger revenue, job losses could grow to 3.1 million, and air traffic could decrease to 51%.
Additionally, reports of estimated losses to be accumulated by African countries include;
- South Africa: 14.5 million lesser passengers resulting in a US$3.02 billion revenue loss, risking 252, 100 jobs and US$5.1 billion in contribution to South Africa’s economy.
- Nigeria: 4.7 million lesser passengers resulting to the loss of US$0.99 billion in revenue, 125, 400 jobs and US$0.89 billion in contribution to the Nigerian economy.
- Ethiopia: 2.5 million in passenger reduction which could lead to US$0.43 billion revenue loss, risking 500, 000 jobs and US$1.9 billion in contribution to the Ethiopian economy.
- Kenya: 3.5 million lesser passengers resulting in US$0.73 billion revenue loss, risking 193, 300 jobs and US$1.6 billion in contribution to the Kenyan economy.
- Tanzania: 1.5 million lesser passengers resulting in a US$0.31 billion loss in revenue, risking 336, 200 jobs and US$1.5 billion in contribution to the Tanzanian economy.
- Mauritius: 3.5 million lesser passengers resulting in a US$0.54 billion in revenue loss, risking 73, 700 jobs and US$2 billion in contribution to the economy of Mauritius.
- Mozambique: 1.4 million fewer in passenger numbers resulting in a US$0.13 billion revenue loss, risking 126, 400 jobs and US$0.2 billion in contribution to Mozambique’s economy.
- Ghana: 2.8 million fewer passengers resulting in a US$0.38billion loss in revenue, risking 284, 300 jobs and US$1.6 billion in contribution to Ghana’s economy.
- Senegal: 2.6 million fewer passengers resulting in a US$0.33 billion loss in revenue, risking 156, 200 jobs and US$0.64 billion contribution to Senegal’s economy.
Conclusion and Recommendation
Conclusively, it has been shown that in Africa, the aviation sector has been adversely affected by the Covid-19 pandemic having contributed quite significantly to the economy of a number of African countries. It is therefore important for African governments to put in place measures to help rescue African airlines from collapse, to save jobs and to improve the economy when the pandemic comes to an end. Countries such as South Africa and Kenya have deferred taxes on companies and industries including airlines, Senegal has announced financial relief for its aviation sector, Seychelles has waived all aircraft landing and parking fees from April to December, 2020. The African Airlines Association came up with a recovery plan for African airlines after the Covid-19 pandemic which highlighted subsidies, loans, policy making, and review of maintenance programs, among others.[16]
Our recommendation, in line with IATA, is that other African nations need to adopt similar approaches including financial relief, tax relief and when the pandemic is over, the borders need to be reopened to begin air travels as they are important to economic recovery. In addition to financial relief, the industry will also need careful planning, supervision and coordination to ensure that airlines are ready to begin operations as soon as the pandemic is contained because economic recovery is widely dependent on the rescue of the aviation sector. There is also need to enhance cooperation and collaboration among African airlines through more codeshare agreements, flexible business models as it will be important to sustain long term survival. African governments also need to offer assistance and coordination through the African Union and other regional economic blocs. Airlines will need to adopt strategies mentioned above to re-establish themselves and the government need to be present to assist in order to make sure that the aviation industry in Africa gains its footing once again and from there we can look forward into permanently improving the growth of aviation in the continent.
[1] Barrister and Solicitor of the Supreme Court of Nigeria, a member of Forum For Ideas, an Aviation Analyst, a prolific writer and researcher. Email: am.chiziboms@gmail.com Phone No: 08184428099, 08155330259
[2] “How COVID-19 Spreads”, Center for Disease Control and Prevention. 2 April 2020
See https://en.m.wikipedia.org/wiki/COVID-19_pandemic/
[3] “COVID-19 Dashboard by the Center for Systems Science and Engineering (CSSE) at Johns Hopkins University (JHU)”. Johns Hopkins University. Retrieved 22 May 2020.
[4] The World of Air Transport in 2018- by ICAO. https://www/icao.int/annual-report-2018/Pages/the-world-of-air-transport-in-2018.aspx/ See also E. Mazareanu, Global Air Traffic- Scheduled Passengers 2004-2020, 10 March, 2020
[5] See: https://www.thelogisticsoflogistics.com/air-cargo-basics/
[6] The World of Air Transport in 2018- by ICAO. https://www/icao.int/annual-report-2018/Pages/the-world-of-air-transport-in-2018.aspx/
[7] International Air Transport Association (IATA), Four Priorities for African Aviation, 11 November 2019 See: https://www.iata.org/en/pressroom/pr/2019-11-11/
[8] Air Transport, Passengers Carried- Sub-Saharan Africa.
See https://data.worldbank.org/indicator/IS.AIR.PSGR?
[9] See https://www/africanaerospace/\.aero/africa-sees-passenger-traffic-growth-in-april.html/
[10] These include Royal Air Maroc, South African Airways and Kenya Airways.
[11] https://www.iata.org/en/pressroom/pre/2020-04-23-02/
[12] Paul Vecchiatto and Antony Sguazzin, South African Airways to Enter into Bankruptcy Protection, December 4, 2018, updated on December 5, 2019.
[13] Ibid note 11
[14] https://www.africanews.com/2020/05/16/economics-of-covid-19-impact-on-africa/ why African skies could recover earlier-by Africa News
[15] Aviation Relief for African Airlines Critical as COVID-19 Impacts Deepen https://www.iata.org/en/pressroom/pre/2020-04-23-02/ 23 April, 2020
[16] afraa.org/afraa-recovery-plan/
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