THE International Air Transport Association (IATA) says more jobs could be generated and additional economic growth achieved in Namibia if intra-African markets were opened up to permit greater airline transport connectivity.
This was the major finding of a ‘Value of Aviation for Africa’ econometric report commissioned by IATA. The report, which examines the impact of liberalised air transport for Namibia and 11 other major African economies, was expected to be presented to minister of works and transport, Alpheus !Naruseb last night.
MORE JOBS
The report, undertaken for IATA by independent economic consultants InterVISTAS, found that Namibia stands to benefit from an additional 10 600 jobs and US$94,2 million (about N$1,17 billion at current exchange rates) additional GDP per year if just the countries in the study were to implement the 1999 Yamoussoukro decision to open Africa’s skies to African airlines.
“This report demonstrates beyond doubt the tremendous potential for Namibia if the shackles on aviation are taken off. But for the full benefits to be realised, Namibia should work to encourage all African states to embrace the Yamoussoukro agenda. A potential five million passengers a year are being denied the chance to travel within Africa because of unnecessary restrictions on establishing air routes, “said Raphael Kuuchi, IATA’s vice president for Africa.
The 12 nations studied in the report are: Algeria, Angola, Egypt, Ethiopia, Ghana, Kenya, Namibia, Nigeria, Senegal, South Africa, Tunisia and Uganda. The Yamoussoukro Decision of 1999 committed 44 signatory countries to deregulating air services and to opening regional air markets to transnational competition. Implementation of this agreement, however, has been slow, and the benefits have not been realised.
“African airlines are expected to return a profit of just US$100 million in 2015, on a net profit margin of 0,8%, the thinnest of all aviation regions. While other regions are experiencing robust growth this year, demand for air travel within the regulatory-constrained intra-African market is only expected to grow by 3,2% this year. Smarter regulation, giving African carriers greater access to all intra-African markets, would stimulate competition and with it demand for travel as businesses and traders were able to expand into those markets,” Kuuchi added.
LIBERALISATION
The research found that liberalisation would cause airfares to fall by between 25% and 37% in the 12 countries under review, making air travel more affordable to more people. In turn, this will help to stimulate an 81% increase in traffic flows between the 12 countries within two to three years. In terms of passenger trips, this translates to an increase from the present 6,1 million passenger trips to 11 million passenger trips that is an additional 4,9 million passenger trips. For Namibia alone, this would be a 92% increase with passenger movements swelling to 1 107 200 from 577 800 recorded in 2013. The bulk of this growth would be on the air services linking Namibia with Angola and South Africa.
InterVISTAS’s study concluded that the additional jobs and economic activity created directly by the airlines and indirectly by an open skies framework facilitating increased trade, investment, business, tourism and productivity, will drive faster GDP growth, an additional US$1,2 billion across the 12 countries, of which US$94,2 million, or a 0,56% increase, is projected for Namibia.
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