- SA Airways proposed merger with Kenyan Airways to create a formidable African Airline a game changer for SAATM.
- Seventeen African countries out of 35 signatories want SAATM to start as soon as possible.
- SAATM is in line with AU's Agenda 63 and could result in an increase in GDP of about R71.4 billion.
- For more financial news, go to the News24 Business front page.
South Africa is one of 17 African countries that have set in motion the long-awaited Single African Air Transport Market (SAATM) that aims to consolidate the aviation market at continental level.
The other countries are Senegal, Togo, Zambia, Niger, Gabon, Namibia, Kenya, Ethiopia, Rwanda, Cape Verde, Ivory Coast, Cameroon, Ghana, Morocco, Mozambique, and Namibia.
These are a slight majority of 35 African countries which are signatories to the SAATM.
The 17 countries agreed on this pilot project at the commemoration of the 1999 Yamoussoukro Decision day (YD Day) at the National, Regional and Continental levels meeting in Dakar, Senegal, on 14 November.
According to the African Union (AU), the YD Day "entered into force in 2000 following its endorsement by Heads of State and Government of the African Union for the liberalisation of scheduled and non-scheduled air transport services within Africa and with an overall aim of removing restrictions on traffic rights, capacity, and frequency between city pairs."
The SAATM the AU said is within the context of the continent's Agenda 2063.
"Africa's time has come. The full implementation of the YD and the operationalisation of the SAATM at the continental level should not be delayed any longer. The benefits for the continent are undeniable," said Victoire Sidémého Dzidudu, the Prime Minister of the Republic of Togo.
The pilot phase
From 11 December, Kenyan Airways will be flying into the capitals of Ghana and Senegal under a "Fifth Freedom of The Air" agreement which means carrying passengers between two countries that are different from the home base of the airline operating the flight.
This will give wider options to passengers flying between Nairobi and Accra, nine weekly flights, and Nairobi and Dakar, four weekly flights.
Fifth freedom flights help an airline fly to more international cities economically. For example, Kenya Airways will do a round trip and cover a route that is not economically viable for another airline in the region.
Julius Thairu, Kenya Airways' chief commercial, and customer officer, quoted by the media in Kenya said they will "offer our guests more travel and connectivity options within West Africa. Strategically, the bigger picture is to support the Single African Air Transport Market and the African Continental Free Trade Area, which are key pillars for Africa’s growth, by growing and deepening our network connections within the continent".
But some airlines feel the SAATM would benefit bigger airlines in the region and lead to the smaller ones closing shop.
For smaller players, Kenyan Airways and SAA, which are working on creating a Pan-African airline, as well as Ethiopian Airlines, the most profitable in Africa could be the big winners if SAAMT was fully functional.
The 35 signatories dominate 80% of the aviation market in Africa.
The International Air Transport Association (IATA) sees great potential in the SAATM even with as few as 12 players in the industry taking it up.
"Just 12 key Africa countries opened their markets and increased connectivity, an extra 155 000 jobs and US$1.3 billion in annual GDP would be created in those countries," the aviation trade association said.
Aviation export reports say if fully implemented, the air transportation proposal might eventually result in an increase in GDP of about R71.4 billion ($4.2 billion) 600 000 new employment, a 27% decrease in fares, and support the United Nations Sustainable Development Goals.
The News24 Africa Desk is supported by the Hanns Seidel Foundation. The stories produced through the Africa Desk and the opinions and statements that may be contained herein do not reflect those of the Hanns Seidel Foundation.