Sluggish GDP growth hampers SA aviation

(Left to right) Sylvain Bosc, the chief commercial officer of SAA, Chris Zweigenthal of AASA and Hadi Hakoum, the head of sales at Airbus. (Photo: Carin Smith)
(Left to right) Sylvain Bosc, the chief commercial officer of SAA, Chris Zweigenthal of AASA and Hadi Hakoum, the head of sales at Airbus. (Photo: Carin Smith)
Flic en Flac (Mauritius) – The global airline industry continued its recovery in 2013/2014 with projections for a net profit of $18bn in 2014 compared to a profit of $10.6bn in 2013, according to Chris Zweigenthal, CEO of the Airlines Association of Southern Africa (Aasa).

“Africa has also shown resilience in turning a $100m loss in 2012 to a profit of $100m in 2013 and a profit of between $100m and $200m is projected for 2014,” he said at the 44th annual general meeting of Aasa.

“Within Southern Africa results are expected to mirror those from the rest of Africa. Global passenger growth projections worldwide are expected to be at between 4% and 5% per year, while in Africa the forecast is for a 6% growth.”

SA's sluggish growth hampers projections

Within South Africa the sluggish gross domestic product (GDP) growth projection of 1.4% per year has, however, constrained growth passenger growth projections to an overall expected 2.2% for 2014.

Aasa currently has 20 scheduled airline members and 31 associate members.

Among the projects in which Aasa has been involved during the past financial year, there was black economic empowerment accreditation and a regulatory review process for the Airports Company SA (Acsa) and the Air Traffic and Navigation Services (ATNS).

According to Zweigenthal, further programmes expected to receive attention is the harmonisation of civil aviation regulations where possible.

Safety first

A programme where he says Aasa is beginning to see substantive progress is the formation of the SADC Aviation Safety Organisation (Saso), which would provide improved safety oversight to the Southern African region.
Aasa was also involved with negotiations regarding new immigration rules in South Africa.

“There was a need for the industry to meet with the minister of home affairs in September and soon thereafter the minister agreed to postpone the implementation of the unabridged birth certificates and established a task team to consider the appropriate means to implement this provision by May 1, 2015,” said Zweigenthal.

Environmental challenges remain another issue with which Aasa deals.

It appears that South Africa will await the results of the Icao initiatives before deciding on the way forward for international flights.

Carbon tax obstacle

However, with respect to domestic flights, South Africa remains intent on implementing a carbon tax. The minister of finance has announced a delay in the implementation of carbon taxes from 2015 to 2016.

Aasa remains opposed to the introduction of carbon taxes, advocating for the alignment of an international and domestic solution.

Aasa has also participated in an environmental impact assessment regarding noise pollution in terms of the construction of a re-aligned runway at the Cape Town International Airport.

This year the impact of the Ebola virus on the industry also formed part of the report delivered at the AGM.

“Aasa continues to pass on all appropriate information related to the disease and new means of response as put forward by the World Health Organisation or by the appropriate authorities,” said Zweigenthal.
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