International Bureau of Aviation expose issues with the growth of African Aviation

As the IATA conference draws to a close for 2013, the International Bureau of Aviation, IBA Group, looks closely at the developing opportunities arising from the exponential growth and profit reported within the African aviation industry.

Africa represents 20.2% of earth’s land and, with a population set to double by 2036, aircraft manufacturers have highlighted Africa as a key growth market, thanks to deregulation in the aviation industry, economic and demographic growth, along with an increase in inter-regional trade.

Whilst aviation is now forming an essential part of the Continent’s development, IBA Group insists careful consideration must be given to its fundamental infrastructure. Phil Seymour, IBA’s president and COO comments, “The investment opportunities and anticipated growth expected from African aviation must not overlook imperative infrastructure improvements which need to take place. Airports, air traffic control and the regulatory authorities of existing and developing airlines will need to improve to international standards in order to compete successfully.”

The prospects for air transport to drive economic and social development in Africa will need to strike a fine balance between the available opportunities and their associated challenges. Recent developing ventures have struggled to overcome a range of impediments allied with the complex legal and political issues which plague much of the Continent.

Seymour continues, “Virgin Nigeria and Fastjet’s African plans have both faltered due to the intricate and widespread governmental disputes; Africa has the potential to emerge as a global economic power, but will need to harness the opportunities in order to capitalise on this industrialisation.”

The high-cost operating environment means the Continent’s airlines are prevented from forging the important role aviation connectivity and economic growth could play throughout Africa. Fuel costs are frequently 20% more expensive in Africa than the global average, whilst taxation charges make connecting travel onerous to the consumer.

According to IBA’s JetData* database, there are currently 1,014 Western built commercial aircraft currently in operation in Africa amongst 187 operators. Boeing has recently forecast that Africa will require 900 new aircraft over the next 20 years. Using these aircraft, aviation will enable global connectivity, in turn integrating the 54 national economies of Africa to the rest of the world.

Fundamental to the growth of African aviation is the commitment of governments to actively solve corruption on a national scale, combined with effective harnessing of investment opportunities, allowing airlines to follow the solid reputation of South African Airways, Ethiopian Airlines and Kenya Airways.

In conclusion, Seymour finishes “Until more African countries embrace the ICAO airworthiness standards and invest in the best quality advisors, the growth forecasts will not be met. Whilst new aircraft are efficient, they also tie up hard to find capital, reducing profit required for growth. Africa needs investment in the simple things, such as experienced pilots and technicians as well as the structural and more expensive investments in airport and air traffic control systems.”

For a detailed report please click here to see Phil Seymour’s appearance on Bloomberg TV. For further information on the services offered by IBA Group, please contact Owen Geach, Commercial Director, on owen.geach@ibagroup.com or call +44 (0) 1372 224488.