African airlines told to ‘co-operate or perish’

Trade and Industry Correspondent

NAIROBI — Most African airlines are too small or financially weak to vie effectively with European and Middle Eastern carriers.

This has made it necessary for African airlines to merge or risk collapse, delegates at the 16th Annual African Aviation Finance Conference heard last week.

Both European and Middle Eastern airlines accounted for 75% of the passenger traffic in and out of Africa, said Zemedeneh Negatu, a managing partner of Ernst& Young in Ethiopia.

European carriers alone were responsible for 66% of the traffic flow. With American airlines also planning to get a share of the lucrative African market, weak African airlines would find it increasingly difficult to operate on their home turf, he said.

Negatu said there were only three major airlines (by passenger numbers) in Africa — South African Airways (SAA), Ethiopian Airlines and Kenya Airways — and cautioned that other national airlines could not survive on their own for much longer.

“African airlines have to consolidate or perish,” Negatu said.

Although he did not mention any names, industry players said national flag carriers such as Air Zimbabwe, Air Malawi and Air Botswana were not likely to survive much longer.

Publisher of African Aviation magazine Nick Fadugba agreed with Negatu, saying lack of co-operation among African airlines had led to the demise of Air Zaire, Air Afrique, Nigerian Airways and Ghana Airways. “Only a few African airlines will survive,” he said.

Ethiopian Airlines CEO Girma Wake said another hindrance to African airlines’ growth was that some governments lacked the political will to fully open up their markets. In 1988 heads of African governments pledged to give all airlines in Africa open access into their skies.

So any airline in Africa could, in theory, operate from any airport in Africa without needing to get permission. The only requirements of the agreement, called the Yamassoukro Decision, are that the airlines had to be properly registered, must follow rigorous safety checks, and pay airport charges where they operate.

Airlines operating in the European Union have already implemented a similar model.

With nearly 20 years of more talk and less action by some African governments, the airlines have proposed that defaulters be isolated from the agreement until they fully complied.


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