‘Every additional tax, charges slow airlines, aviation growth’
The International Air Transport Association (IATA) yesterday warned Nigerian and other African governments that additional taxes and charges would further stifle the growth of airlines in particular, and the industry in general.
IATA, the clearing house for 280 airlines globally, at the meeting of African Airline Association (AFRAA) in Mauritius, said the industry was already bleeding to accommodate extra operating costs. Recall that sundry charges, under the guise of taxes and levies at airports in Nigeria, account for at least 40 percent of revenue accrued to the airlines. Besides the five per cent charge on every ticket bought by passengers, which goes to all five regulatory agencies, there are other 36 charges on the operators.
The airlines, in place of more taxes, called on governments and industry in Africa to focus on safety and cost-competitiveness to allow aviation to drive economic and social development on the continent, enrich people’s lives and enable the United Nations Sustainable Development Goals (SDGs).
IATA’s Director General and CEO, Alexandre de Juniac, said across the African continent, the promise and potential of aviation is rich. “Already it supports $55.8 billion in economic activity and 6.2 million jobs. And, as demand more than doubles over the next two decades, the critical role that aviation plays in Africa’s economic and social development will grow in equal proportion. With the right tax and regulatory framework, the opportunities aviation creates to improve people’s lives are tremendous,” he said.
More states need to incorporate the IATA Operational Safety Audit (IOSA) into their safety oversight systems. Mozambique, Rwanda, Togo and Zimbabwe have done so. Smaller operators should consider becoming IATA Standard Safety Assessment (ISSA) certified. ISSA provides a valuable operational benchmark for carriers not eligible for IOSA.
African states need to implement ICAO standards and recommended practices in their regulations. Currently, only 26 states meet or exceed the threshold of 60 per cent implementation.“Our top priority is always safety. And we must never forget that global standards have helped to make aviation the safest form of long-distance transport. There is a good example of that in the safety performance of African airlines. The continent had no fatal jet accidents in 2016, 2017 and 2018. That is largely due to the coordinated efforts of all stakeholders with a focus on global standards, guided by the Abuja Declaration. But there is still more work to do. Taking these three steps will raise the safety bar even higher,” de Juniac said.
IATA highlighted the need for a cost-competitive operating environment for airlines in Africa.“African carriers lose $1.54 for every passenger they carry. High costs contribute to these losses Flying is not a luxury—it is an economic lifeline for this continent. That’s why it is critical for governments to understand that every extra cost they add to the industry reduces aviation’s effectiveness as a catalyst for development,” de Juniac said.
IATA also called on governments to follow treaty obligations and ensure the efficient repatriation of airline revenues at fair exchange rates. Currently, funds are blocked in 19 African states. “It is not sustainable to expect airlines to provide vital connectivity without reliable access to their revenues.”
IATA called on governments to liberalise intra-Africa access to markets and urgently implement three key agreements which have the potential to transform the continent. These are:
the African Continental Free Trade Area (AfCFTA) – to boost intra-Africa trade through the elimination of import duties and non-tariff barriers. The African Union (AU) Free Movement Protocol – to ease the severe visa restrictions that African countries impose on African visitor. Single African Air Transport Market (SAATM) – to open up intra-Africa air connectivity.
“My message to governments on this triumvirate of agreements is simple—hurry-up! We know the contributions that connectivity will make to the UN SDGs. Why wait any longer to give airlines the freedom to do business and Africans the freedom to explore their own continent,” de Juniac said.
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