Aviation: Airlines Urge African Nations To Release Blocked Funds
The African Airlines Association (AFRAA) called upon African governments to release funds they have blocked airlines from repatriating due to a shortage of foreign currency.
Addressing delegates attending the opening of the 48th AFRAA annual general assembly at Victoria Falls in Zimbabwe, on Monday, AFRAA secretary general Elijah Chingosho said African countries hit hard by the nosediving price of oil remain reluctant to release revenues to foreign airlines for repatriation.
Chingosho named Angola, Nigeria, Egypt and Sudan as the countries in question. “Nigeria and Egypt have repatriated some funds recently,” he said. “However, it is critical that airlines should be able to fully repatriate their funds,” he said. AFRAA estimates that the four countries continue to withhold some $2 billion in revenues.
Chingosho added that the high cost of fuel in some African countries has also proved a challenge to airlines, despite the oil price decline on the global market. Some international airlines have begun to consider suspending or cutting operations to Nigeria due to the high cost of fuel and the problem with repatriation of funds.
Recently, Emirates Airline CEO Tim Clark told the international media that his airline might cut operations to Nigeria. Kenya Airways has stopped its flights to Abuja as part of its cost cutting measures.
Chingosho said exorbitant fuel tax, airport charges and air ticket tax stand as big challenges facing African airlines. According to the International Air Transport Association (IATA), African airlines lost $700 million last year. Cumbersome taxes, hefty fuel price and stiff competition with mega international carriers have contributed to the huge loss African airlines are recording, added Chingosho.
For his part, IATA vice president for Africa Raphael Kuuchi said that safety and security remains an area of concern in Africa despite significant improvements made in recent years. “Safety and security, high operational cost and regulation issues are some of the hurdles that need to be addressed,” he said.
According to Kuuchi, IATA has supported African airlines’ efforts to improve safety and security records by providing training and assisting their enrollment on the International Operational Safety Audit (IOSA) registry. IATA has increased the number of African airlines the registry from 18 to 32. This year five new African airlines joined the IOSA but four failed to maintain their registration.
“IATA will continue supporting African airlines in areas of safety and security,” Kuuchi assured African delegates. Kuuchi also mentioned declining market share of African airlines and falling oil prices as some of the existing challenges for African nations.
More than 400 delegates consisting of airline CEOs, civil aviation and airport authorities, aircraft and engine manufacturers, IT and other service providers gathered in Victoria Falls to attend the 48th AFRAA annual general assembly. Representatives of IATA, ICAO, the African Union, the African Civil Aviation Authority and senior government officials of Zimbabwe are attending the conference, where officials expect to adopt a number of resolutions before it closes on November 22.
Aviation contributes $72 billion to the continent’s GDP and supports 6.8 million jobs. According to IATA’s recent forecast, Africa’s passenger traffic will grow at a rate of 6.5 percent this year.