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Strong South African air traffic growth forecast

30th June 2017

By: Keith Campbell

Creamer Media Senior Deputy Editor

     

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The International Air Transport Association (Iata) has forecast that the number of air passenger journeys to, from and within South Africa will more than double from 23.6-million last year to more than 54-million by 2036. This will be the result of an average annual growth rate in the country’s local and international air travel of 4.3%, significantly above the expected rate of 3.5% for the aggregated global industry.

The forecast was released at a recent briefing at OR Tambo International Airport, in Kempton Park, east of Johannesburg. However, Iata regional VP: Africa and the Middle East Muhammad Ali Albakri did sound a note of caution. If the South African authorities were “not careful with charges, taxes and fees, these projections could be endangered”, he said.

The 2016 figure of 23.6-million air passenger journeys was some 1.2-million higher than in 2015, an increase of 5.3%. In very sharp contrast, South Africa’s gross domestic product (GDP) rose by only 0.3% in 2016. (Iata forecasts that South African economic growth will return to more than 2% in five years.) The 2016 figure comprised 54% domestic travel and 46% international (including regional) travel. In other terms, there were 12.7-million domestic air passenger journeys within South Africa and 10.9-million international passenger journeys to and from the country last year. The largest air travel markets for South Africa were the UK, Zimbabwe and the local market.

Growth has continued into 2017. Preliminary data for the first quarter of this year shows that this period saw nearly six-million air passenger journeys to, from and within South Africa. This represents an increase of 3.5% over the same period last year.

The association also released a report on the contribution that aviation makes to the South African economy. This includes generating $12-billion, or 3.5%, of the national GDP, and sustaining about 490 000 jobs. In terms of jobs, a breakdown shows that 70 000 are directly created by the aviation industry (including airlines, airports, air navigation service providers and manufacturers) and 130 000 are in the industry’s supply chain, while 57 000 jobs are sustained by the spending of employees of the aviation sector, and another 230 000 are maintained by tourism facilitated by aviation.

Every year, some 390 000 aeroplanes take off from and land at South Africa’s main airports. In 2014, South Africa received 3.3-million passengers from Europe, 1.3-million from the Asia-Pacific region, 700 000 from North America, 460 000 from Africa and 150 000 from Central and South America. The busiest single airport is OR Tambo, through which more than 18.5-million passengers passed in 2014. Air transport directly links South Africa to four of the world’s ten fastest-growing countries (India, China, Angola and Nigeria). The country has 20 direct flights a week to two of the world’s ten fastest-growing cities (Kinshasa and Lagos).

“The study confirms the vital role of air transport in facilitating over $10-billion in exports, some $140-billion in foreign direct investment and around $9.2-billion in inbound leisure and business tourism for South Africa,” he observed. “With the country now in a recession, it’s time to redouble efforts to promote South Africa as a destination for business, trade and tourism.”

Although South Africa ranks first out of a survey of 37 African countries (conducted among executives at the World Economic Forum) in terms of transport infrastructure, it only ranks seventeenth in terms of air transport industry cost competitiveness (measured in terms of air ticket taxes, value-added tax and airport charges). Regarding visa openness, South Africa occupies nineteenth place.

“Affordable, safe and reliable air transport is crucial to economic growth,” affirmed Albakri. “It promotes skills development and is a catalyst for jobs. We urge the South African government to remove any impediments, including unnecessary red tape and policies that hinder air connectivity and the trade, investment, tourism and job opportunities it facilitates and stimulates.”

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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