African airlines’ traffic up 53.5% in April

A recent report by the International Air Transport Association revealed that African airlines experienced a remarkable 53.5% increase in traffic in April 2023, positioning the region as the second-highest among global regions. This surge in passenger traffic has brought the industry to 90.5% of pre-Covid levels, signaling a promising recovery. Fubara Anga, Partner and Head of Transportation Group at AELEX, provided insightful commentary on the report, highlighting both the positive trends and challenges facing the aviation sector in Africa. While the increase in traffic is indeed a cause for optimism, Anga emphasized the need to scrutinize the data comprehensively. Comparing the global scenario, it becomes evident that while African airlines have shown significant growth, the figures are not as robust as they may seem at first glance. The Asia-Pacific region, for instance, registered a staggering 192% increase in traffic, overshadowing the growth in Africa. Additionally, Anga pointed out that assessing capacity and load factor is crucial in evaluating the industry's health. Despite the rise in traffic, Africa's load factor remains at around 69-70%, the lowest among all regions, posing challenges for airlines to break even. In response to addressing these challenges, Anga underscored the importance of considering both the supply and demand sides of the aviation sector. The rise in travel demand, driven by the pent-up desire to explore both domestic and international destinations post-Covid, presents opportunities for growth. However, regulatory hurdles and economic factors such as inflation and tightening monetary policies continue to hinder the industry's potential. To foster sustainable growth, Anga highlighted the need for a transparent and consistent regulatory framework that supports the sector's development rather than acting as a barrier. As the conversation shifted towards the impact of economic factors on summer travel, Anga noted the complexities at play. While international travel demand remains relatively strong and inelastic to price changes, the reduction in airline capacity due to various factors has led to increased ticket prices. The recent removal of subsidies and the depreciation of foreign currencies, particularly the US dollar, have contributed to higher costs for passengers. Business class tickets to popular destinations like London have seen significant price hikes, reflecting the impact of currency fluctuations on air travel costs. In conclusion, while African airlines have made significant strides in boosting traffic levels, there are underlying challenges that must be addressed to ensure the industry's long-term sustainability. By adopting proactive measures to streamline regulations, enhance operational efficiency, and mitigate economic uncertainties, the aviation sector in Africa can navigate the current landscape and capitalize on the growing travel demand.