Trade group says pandemic shutdowns will cost airlines billions in losses and millions of jobs lost
The International Air Transport Association (IATA) a global trade group representing the world’s airlines is calling for additional aid to be given to airlines in Africa or will see billions of dollars lost and millions of jobs erased as a result of the COVID-19 pandemic that has killed more than 200,000 worldwide.
The region’s airlines could lose US$6 billion of passenger revenue compared to 2019. That is US$2 billion more than was expected at the beginning of April. Job losses in aviation and related industries could grow to 3.1 million. That is half of the region’s 6.2 million aviation-related employment and more than the previous estimate of 2 million. Full-year 2020 traffic is expected to plummet by 51 percent compared to 2019 compared to the previous estimate of 32 percent. GDP supported by aviation in the region could fall by US$28 billion from US$56 billion compared to a previous estimate of a US$17.8 billion decline. These estimates are based on a scenario of severe travel restrictions lasting for three months, with a gradual lifting of restrictions in domestic markets, followed by regional and intercontinental.
Countries likely to be hardest hit include:
To minimize the impact on jobs and the broader African economy it is vital that governments step up their efforts to aid the industry. Some governments in Africa have already taken direct action to support aviation, including:
But more help is needed. IATA is calling for a mixture of:
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. 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,” said Muhammad Al Bakri, IATA’s Regional Vice President for Africa and the Middle East.
In addition to vital financial relief, the industry will also need careful planning and coordination to ensure that airlines are ready when the pandemic is contained.
IATA is scoping a comprehensive approach to re-starting the industry when governments and public health authorities allow. A series of virtual regional summits, bringing together governments and industry stakeholders have been taking place. The main objectives will be:
“As governments struggle to contain the COVID-19 pandemic, an economic catastrophe has unfolded. Re-starting aviation and opening borders will be critical to the eventual economic recovery. Airlines are eager to get back to business when and in a way that it is safe. But starting up will be complicated. We need to make sure that the system is ready, have a clear vision of what is needed for a safe travel experience, establish passenger confidence and find ways to restore demand. Cooperation and harmonization across borders will be essential to restart aviation,” said Al Bakri.
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