An estimated 3.1 million jobs in Africa are at risk if the continent’s aviation sector was to collapse, the International Air Travel Association (IATA) said on Thursday.
Africa’s aviation sector has been hard hit by the coronavirus pandemic with low demand for flights across the continent coupled with several cancellations and suspensions resulting in a huge drop in passenger revenue.
Air transport in Africa supports about 6.2 million jobs with Ethiopia the most reliant on it with more than 500,000 jobs followed by Tanzania (+336,000), Ghana (+284,000) and South Africa (+250,000).
Airlines in Africa stand to lose as much as $6 billion this year in passenger revenue as travel restrictions brought about by the coronavirus pandemic continue to bite, according to the trade association of the world’s airlines.
Airlines across the continent have recorded a loss of $4.4 billion in revenue as of March 11 since the emergence of the virus, an IATA report said.
Additional statistics from the IATA indicate that South Africa’s Gross Domestic Product will be the worst hit by the COVID-19 crisis with an estimated loss of $5.1 billion in contribution to its economy. The other countries estimated to be worst hit are Mauritius ($2 billion), Ethiopia ($1.9 billion), Kenya and Ghana ($1.6 billion) and Tanzania ($1.5 billion). Overall, GDP supported by aviation across Africa could fall by $28 billion from $56 billion.
IATA further estimates that traffic for the continent for the whole year will drop by 51 percent compared to the previous estimate of 32 percent. The estimates from IATA are based on the assumption that severe travel restrictions due to COVID-19 will last three months.
Muhammad Al Bakri, International Air Travel Association (IATA) regional vice president for Africa and the Middle East, said that the longer the airlines wait for government help, the more risk they will be exposed to.
“We have not seen the desired help announced for African airlines so far,” Al Bakri told journalists during a press conference.
IATA has proposed a number of relief options for governments to consider implementing to stabilize the sector. They include: direct financial support, loans and tax relief.
“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,” Al Bakri said.
In light of the persisting effects of the pandemic, airlines and countries have taken different measures in response to the fall in airline passenger revenue.
Ethiopian Airlines, Africa’s largest carrier, is now stepping up cargo operations to help defer lease payments as it faces a revenue loss of $550 million from January to April alone. Kenya Airways has also focused its operations on cargo and converted four of its passenger aircraft into cargo carriers.
South Africa has deferred payroll, income and carbon taxes across all industries, which is expected to also benefit airlines based there. Senegal allocated $128 million in relief for the Tourism and Air Transport sector while Seychelles waived all landing and parking fees for April to December.