‘SA Aviation needs to get house in order’

2012-10-19 15:58

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Maputo – With continental GDP well ahead of the West at an expected 5% this year, it’s time Southern African Airlines to get their house in order, this is according to Mango CEO Nico Bezuidenhout at the 42nd Annual General Meeting and Conference of the Airlines Association of Southern Africa taking place in Maputo, Mozambique.

According to Bezuidenhout, low cost carriers (LCC) are more relevant today than ever.

“Simple arithmetic makes it clear that opting for a lower cost base and better operational efficiency is preferable to the higher input costs normally associated with traditional carriers.  LCC outnumber legacy carriers by 3:2 in South Africa,' said Bezuidenhout

“I believe that South Africa holds the potential to drive sector growth in the region and, indeed across the entire Sub-Saharan continent. In addition, low cost and rejuvenated traditional carriers will drive this growth with airports like Lanseria playing a meaningful supporting role," according to Gavin Sayce, General Manager, Lanseria International Airport.

Regional expansion, in particular among low cost carriers, bodes well for the use of secondary airport facilities like Lanseria.  Six years ago, domestic airline Kulula started at Lanseria Airport with a daily return flight to Cape Town, which was extended to include Durban. In July 2011, Mango also introduced a scheduled service to serve Cape Town. Most recently in March 2012, 1time became the third domestic airline to join operation to the rapidly growing second aviation hub of Gauteng.

In anticipation of growing traffic and aviation demand, Lanseria has commenced construction of a new 3km long runway that will be able to accommodate certain wide-bodied aircraft. Further investment into infrastructure, including upping retail antes and parking facilities, is planned for the near future.

In his AGM address, Bezuidenhout likened the potential of the aviation sector in Africa to the significant impact mobile telephony has had in Africa - bridging gaps between people and markets, reducing the cost of information flow and enabling accelerated growth.

“The strategic impetus for Africa to seek competitiveness on global markets through accelerated development and management of aviation infrastructure is critical.” 

“In Africa, low cost aviation may hold the answer to accelerated growth. It is estimated that low cost aviation has grown the overall market in South Africa by 3-million travellers over the past decade and created well over 15 000 employment opportunities in various up and downstream market segments – from direct job creation through tourism and trade by local entrepreneurs.

“IATA reports that the industry already supports quality employment for approximately 6.7 million Africans with economic activity measuring US$ 67.8 billion. Aviation in Africa could potentially create as many as 5 million new job opportunities in the next ten years and near triple its economic value to US$ 220 billion.

Five major considerations where outlined for this collective goal to be achieved…

1.    The planning and development of aero-infrastructure: Crucial to achieve short, medium and long term goals whereby increased air-traffic can be accommodated in terms of people movement and facilities to manage increasing cargo volumes.

2.    Safety: Africa’s safety record is nine times worse than the global average. Investment into skills training, asset maintenance and fleet upgrades and infrastructure among others. What’s also needed, in order to improve standards, is that airlines have to internalise responsibility for safety and only then, with this realisation, would they begin investing the necessary funds.

3.    Open Skies – implementation of the Yamoussoukro declaration: Bilateral agreements that limit capacity or the number of flights between nations throttles growth and keeps prices high. The adoption and implementation of the Yamoussoukro declaration or similar open-skies treaty will immediately open up the market, drive costs down and enable rapid development.

4.    Environmental Responsibility and Opportunity: Increased traffic means increased emissions. Africa has the unique opportunity, given aviation’s current developmental state, to engineer responsible offsetting of its GHG footprint. Unlike other markets, where reverse engineered solutions resulted in instruments such as tradable carbon credits, Africa has the potential to deliver offsets for its own, and the world’s emissions. Offsetting while assuming immediate responsibility for its own emissions, could generate significant downstream revenue opportunities for the continent. Africa holds the potential to create the majority of tradable carbon credits for sale on world markets.

5.    Vested interest partnerships: Given the immense capital required to accelerate the development of African aviation, partnerships between all role players becomes a critical cog in the wheel of success. Governments, aircraft manufacturers, airlines, even the construction sector among many others have a vested interest in the growth of continental aviation. Discourse, planning and implementation require commitment to unleash Africa’s potential.

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