Full-year 2020 traffic is expected to plummet 51% compared with the previous year, causing a $28 billion drop in African GDP.
South Africa will be among the countries hardest hit. It is predicted to carry 14.5 million fewer passengers resulting in a US$3.02 billion revenue loss, risking 252,100 jobs and US$5.1 billion in contribution to South Africa’s economy. Nigerian passenger numbers could fall by 4.7 million, potentially leading to the loss of US$0.99 billion in airline revenue, 125,400 jobs and US$0.89 billion in GDP contribution. Ethiopia will see a 2.5 million reduction in passenger numbers, costing airlines there US$0.43 billion and risking 500,500 jobs and US$1.9 billion in economic contribution.
Estimated losses in other countries include:
3.5 million fewer passengers resulting in a US$0.73 billion revenue loss, risking 193,300 jobs and US$1.6 billion in contribution to Kenya’s economy
1.5 million fewer passengers resulting in a US$0.31billion revenue loss, risking 336,200 jobs and US$1.5 billion in contribution to Tanzania’s economy
3.5 million fewer passengers resulting in a US$0.54 billion revenue loss, risking 73,700 jobs and US$2 billion in contribution to Mauritius’ economy
1.4 million fewer passengers resulting in a US$0.13 billion revenue loss, risking 126,400 jobs and US$0.2 billion in contribution to Mozambique’s economy
2.8 million fewer passengers resulting in a US$0.38 billion revenue loss, risking 284,300 jobs and US$1.6 billion in contribution to Ghana’s economy
2.6 million fewer passengers resulting in a US$0.33 billion revenue loss, risking 156,200 jobs and US$0.64 billion in contribution to Senegal’s economy
2.2 million fewer passengers resulting in a US$0.2 billion revenue loss, risking 46,700 jobs and US$0.48 billion in contribution to Nigeria’s economy
Some governments in Africa have already taken direct action to support aviation. Senegal announced a US$128 million relief package for the Tourism and Air Transport sector and Seychelles has waived all landing and parking fees from April to December 2020. Cote d’Ivoire has waived its tourism tax for transit passengers and in South Africa, payroll, income and carbon taxes have been deferred across all industries.
Even so, more help is needed. IATA is calling for a mixture of direct financial support, loans, loan guarantees and support for the corporate bond market, and tax relief.
IATA has also appealed to development banks and other sources of finance to support Africa’s air transport sectors, which are now on the verge of collapse.
“Airlines in Africa are struggling for survival,” said Muhammad Al Bakri, IATA’s Regional Vice President for Africa and the Middle East. “Air Mauritius has entered voluntary administration, South African Airways and SA Express are in business rescue, other distressed carriers have placed staff on unpaid leave or signaled their intention to cut jobs. More airlines will follow if urgent financial relief is not provided. The economic damage of a crippled industry extends far beyond the sector itself. Aviation in Africa supports 6.2 million jobs and $56 billion in GDP. Sector failure is not an option, more governments need to step up.
Al Bakri also noted that restarting aviation and opening borders will be critical to the eventual economic recovery. “Airlines are eager to get back to business…. but starting up will be complicated,” he said. “We need to make sure that the system is ready, to have a clear vision of what is needed for a safe travel experience and establish passenger confidence to restore demand.”