African airlines are set to lose $2 billion in 2020 and the continent’s industry is “at risk of collapse” without more urgent financial relief, according to the International Air Transport Association (IATA).
The governments of Sub-Saharan Africa Rwanda, Senegal, Côte D’Ivoire and Burkina Faso have pledged a total of $311 million in direct financial support to air transport.
A further $30 billion has been promised by some governments, international finance bodies and other institutions including the African Development Bank, African Export Import Bank, African Union and the International Monetary Fund (IMF) for air transport and tourism.
However, much of the relief is yet to reach those in need due to institutional bureaucracy, complex application and creditworthiness processes, as well as cumbersome conditions to secure finance, IATA said in a statement.
“Over USD 30 billion in financial support has been pledged to aviation and tourism in Africa,” said Muhammad Albakri, IATA’s regional VP for Africa and the Middle East.
“Some of this money has been allocated by governments, but far too little of it has reached its intended recipients.
“Governments and lenders need to urgently unchoke the bottlenecks so that the money can flow quickly, otherwise it will be too late to prevent closures and job losses.
“There will be no point re-opening the borders and skies if there is no industry left to speak of that is capable of supporting trade and tourism, which are the key components of any thriving economy.”
So far, Benin, Ethiopia, Ghana, Kenya, Rwanda, Senegal and Tanzania have allowed or announced the imminent resumption of scheduled international passenger flights. Combined, they account for 19% of passenger traffic on the continent.
Travel and tourism contributes $169 billion to Africa’s economy and represents 7.1% of the continent’s GDP.