African Skies Issue No. 53

A bright future for the African commercial aviation industry Revival of the digital passenger

Female wings in African airspace

Passion to create a sustainable future

Another set of crossroads

Report of

study on: Airlines taxes and charges in Africa

TH

AVIATION STAKEHOLDERS

CONVENTION

7-9 May 2023 | Addis

Ababa, Ethiopia

Changing the African Aviation Narrative

AFRAA and Ethiopian Airlines will stage the 11th Aviation Stakeholders Convention from 07-09 May 2023 at the Ethiopian Skylight Hotel in Addis Ababa – Ethiopia.

The Aviation Stakeholders Convention (ASC) is an initiative of AFRAA to bring together aviation ecosystem stakeholders under one roof with the view to foster dialogue, build sustainable networks, create a competitive environment for business and improve the aviation value chain in the continent.

Now in its 11th year, the discussions at the event will evolve on the main theme: “Changing the African Aviation Narrative” best practices and information on win-win supplier-customer relationships.

Sponsorship and Exhibition Opportunities: The Convention provides excellent marketing and visibility opportunities through sponsorship and exhibition. Join us for brand visibility and the opportunity to do business with the over 500 African Aviation top decision makers and leaders.

For more information, please contact

Maureen Kahonge

Senior Manager Business Development & Communications: African Airlines Association (AFRAA)

Tel: +254 725500470

mkahonge@afraa.org

www.afraa.org

Drive the tide for the African airline industry

Looking back from the 1930’s since the earliest African airlines took flight, the industry has navigated different tides while continuously playing an essential contribution to the economic development of the African continent. Regrettably, what has remained unchanged over the past four decades is the modest size of Africa’s air transport industry, which has been at less than 3% share of the world air traffic and remained far from maturity. This contrasts with Africa’s growth potential being among the fastest rates compared to those of the matured air transport markets.

The call to action to change could not come at a better time. The COVID-19 crisis was an impetus to the entire air transport ecosystem to rethink the business to remain agile and far-sighted to ensure that African economies can continue to reap the benefits of aviation. As the industry recovery trajectory picks up from the COVID-19 crisis, currently at 93% of 2019 traffic levels, the focus is to be more efficient and sustainable. The seeds to achieve this change were planted at the first-ever African aviation laboratory organised by the industry and hosted by AFRAA in 2022 to develop roadmaps for the sustainability of the African air transport sector. The overall objective of the Laboratory was to address the root cause of challenges

facing the air transport industry in Africa and develop relevant solutions to revamp the sector.

A year after the Lab, the roadmaps of the five projects are on course. For instance, the AFI Free Routing Airspace has the Project Management Team (PMT) engaged in preparatory works towards the Free Routing Airspace trial implementation of selected routes within Africa. The objective is sustainable flight operations through flying as direct as possible within Africa to reduce operational costs and carbon emissions.

The 11th Aviation Stakeholders Convention, scheduled to take place from 7-9 May 2023, is deliberately aligned on this storyline for change. The Convention, proudly being hosted by Ethiopian Airlines under the patronage of the Government of Ethiopia, will be held under the theme: “Changing the African Aviation Narrative”. Air transport industry stakeholders will converge to deliberate on strategies to enhance efficiencies, create synergies, develop intra-Africa connectivity, and ensure business continuity that will redefine the narrative of the African air transport industry. Change is essential. A sustainable, interconnected and affordable air transport in Africa can be realised through change. “What’s dangerous, as Jeff Bezos quoted, is not to evolve.”

Mr. Abdérahmane Berthé AFRAA Secretary General

A sustainable, interconnected and affordable air transport in Africa.

Another set of crossroads

The latest crossroad is probably the last opportunity in a reset world, can the continent make the right turn?

17

Revival of the digital passenger

Reviving digital customer experience remains key to overcome the challenges of the modern airline world and pave the way towards a successful and sustainable future.

Female wings in African airspace

The biggest challenge for women in African aviation is accessing the opportunities available to them.

04

A bright future for the African commercial aviation industry

Despite the headwinds airlines face, we see a bright future for the African commercial aviation industry, with growing demand across the continent.

A successful partnership

A successful NDC partnership is one where travel partners engage positively with an airline to sell more and different content through new and richer channels.

08

Think finance

Getting the finance team involved early in the process could be the key to unlocking the highperformance retailing potential of ONE Order.

Advancement through collaboration

Enhance the aviation services industry and build a network of like-minded professionals passionate about advancing the sector.

Kiu System Solutions

A company that provides a robust and innovative PSS and suite of airline solutions.

@AfricanAirlines @AFRAA.AfricanAirlinesAssociation

https://www.linkedin.com/company/african-airlines-association/ www.afraa.org

33

A sustainable future

Embraer aim to bring best-in-class aircraft to market at an accelerated pace to help customers and partners meet their climate goals.

37

Airlines taxes and charges in Africa

The objective of this paper is to benchmark the level of air ticket taxes and charges across the continent in comparison with other regions, and identify areas of improvement.

44

Flying Clear of Turbulence

African-skies

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Rachel Musyoni

ADMINISTRATION | ADVERTISING

Azra Chaudhry (UK)

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African-skies is published quarterly for AFRAA by Camerapix Magazines Limited

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A bright future for the African commercial aviation industry

It’s an exciting time for commercial aviation in Africa. Across the entire continent, there are new trends and developments to respond to. Airlines on the continent are looking for smaller aircraft to implement into their operations, particularly narrowbody types and regional turboprops and jets. In East Africa, we’ve witnessed an increase in activity and change in key players, with Addis Ababa in Ethiopia recently becoming the biggest connecting hub in Africa. There has also been a notable increase in activity in Central Africa, alongside the usual high levels across Southern Africa, which continues to be a dynamic aviation market. Seizing the opportunities that exist in the African commercial aviation industry means being fully aware of – and being prepared to respond to – the developing trends and the challenges that exist across the regions.

Recession prompts growth in regional aircraft

It’s perhaps surprising to talk about opportunities given the International Air Transport Association (IATA) predicted that the continent’s airlines will post a loss of around $213 million in 2023, as the industry continues to recover from COVID-19. Despite this, disruption leading to recession doesn’t necessarily lead to inactivity. Instead, a downturn shapes the prospects that exist. For commercial aviation, a recession creates a spike in demand for smaller aircraft offering the lowest risk, typically regional turboprops and jets as well as narrowbody aircraft. Across the continent, we are seeing a particularly strong interest in some of the turboprop models – with more fuelefficient aircraft offering better solutions for domestic operations. This is especially the case for customers who plan to fly to remote destinations.

Challenges faced by Africa

Alongside the many developments across Africa, there are also challenges that hold back the potential of aviation across the continent. Africa’s airlines face significant costs imposed on them by governments, fuel is up to 40% more expensive than elsewhere in the world, accessing financing can be difficult, and with no open-skies agreement regionally or across the continent, growth via route connectivity is stifled. Additionally, even before the pandemic, the airline analytics consultancy OAG noted that the sheer number of airlines operating in Africa posed a challenge, preventing each airline from building a solid base and financial and structural core to survive in the face of competition and new entrants.

Planning for the future

Despite the headwinds airlines face, we see a bright future for the African commercial aviation industry, with growing demand across the continent. While the short-term future of aviation is unpredictable, the sector has always been resilient, and we can expect good things from the African market over the coming years. One development we are watching closely is the potential for the Single Market for Air Transport in Africa (SAATM)’s Focus Africa Initiative, announced in April 2023. Focus Africa involves six areas of concentration, namely safety, infrastructure, connectivity, finance and distribution, sustainability, and future skills. Airlines and governments need to address all areas before they can realise the goal of creating a single transport market. We believe this is the first big

step in the right direction to advance the liberalisation of civil aviation in Africa and give impetus to the continent's economic integration agenda.

For these, and all African airlines moving forward, it will be important to collaborate with expert partners, with the right combination of heritage, local knowledge and access to data to provide genuinely trusted advice. It’s this expert insight that we pride ourselves on at Jetcraft. Our commercial aviation team has been operating in Africa, particularly trading regional and narrowbody aircraft, since 2015. Our diverse offering includes jets from Airbus, Boeing, Bombardier, De Havilland, Embraer and other manufacturers. To find out more about how Jetcraft Commercial can help you seize opportunities in the African aviation sector, visit: www.jetcraftcommercial.com

NDC adoption: Tools for a successful partnership commercial toolkit

A successful NDC partnership is one where travel partners engage positively with an airline to sell more and different content through new and richer channels. During the more than 10-year journey, pioneer airlines have pursued various strategies to encourage travel partners to move from consuming content through the Global Distribution Systems to NDC. The big question for every airline is what adoption strategy will work best for them. Well, it depends. Each strategy employs ‘levers’ of content differentiation or commercial terms to achieve the desired results.

Are you considering implementing IATA NDC? Do you want to grow the success of your strategy?

Do you need help encouraging your airline’s travel partners to migrate to NDC platforms? If you’ve answered yes to any of these questions, download the ‘NDC adoption: Tools for a successful partnership’ commercial toolkit, where Accelya’s Bill Cavendish looks at some of the most common and potent adoption strategies, such as:

• Dangling the carrot: Create a winwin-win situation for the airline-agentcustomer by offering a reward. With this approach, airlines attract sellers

by offering exclusive content and packages (often fare brands) through NDC channels.

• Wielding the stick: Remove incentives for travel sellers to use non-NDC channels by adding surcharges and/or excluding content from the GDS.

• The wholesale model: Place the power firmly in the hands of the travel agent, who then decides from whom and under what terms to source NDC content. The airline provides the agent with its content – and perhaps an incentive – and it’s up to the agent to select an aggregator (GDS or third party).

If you’re still deciding what the best strategy for your airline is, Accelya’s commercial toolkit can guide you. It also includes Tye Radcliffe’s exclusive comparison of the various NDC adoption strategies. Tye is Accelya’s SVP of Product Strategy for the Order group, so he knows the results strategies like carrot, stick, or the wholesale model can give your airline.

Get your copy of the NDC adoption commercial toolkit here or visit www.accelya.com for more information

AUTHOR: Bill Cavendish Global Business Development Accelya

Making the most of ONE Order: think finance!

Getting the finance team involved early in the process could be the key to unlocking the high-performance retailing potential of ONE Order.

Technological changes typically bring opportunities for airlines. That covers both expanded commercial potential and the simplicity of systems and processes. Maximising those opportunities though requires that every team that will be impacted by the change is involved from the start. Bringing the finance team out from ‘behind the scenes’ in the planning and integration phase could be critical in a transformational change such as the implementation of ONE Order.

As the latest step in a journey from paper tickets to a single order, ONE Order will bring a customer-focused digital record that strips out inefficiencies and improves communication between order management, revenue accounting, and delivery providers. For finance, the rewards can be lower costs and a reduction in reconciliation activity.

has a 360-view of what’s going on in the organisation so that surprises can be avoided. Ensuring this is delivered in a change as fundamental as new messaging and standards for Order transformation, and subsequent settlement and accounting is therefore essential.

AUTHOR: Muffi Lokhandwala Business Development for

Solutions

Early input from all key teams is critical Although often regarded as ‘back office’, finance has a critical role to play in compliance, risk, and reporting. Best practice demands that finance

Financial

at Accelya

“Marketing or commercial has these big ideas, and finance gets forgotten. This is not something that they can wait till the last minute to involve us.”

Jenny Benjamin, Revenue Accounting Director, Alaska Airlines

Too often, however, the input of teams that will implement and integrate new standards is introduced too late. Early cooperation can help to avoid bottlenecks and difficulties further down the line. There’s a lot to think about as airlines consider the implementation of ONE Order to drive transformation. And in the journey to high-performance retailing, it’s critical to think as carefully about what happens on the back end in accounting and control systems as the front end. This is particularly urgent if airlines are to achieve IATA’s goal of being in control of 100% of Offers & Orders by 2030.

Where finance can make it count

Some of the key steps finance teams could consider are as follows:

• Sharing their insights into developing the ONE Order vision.

• Ensuring their inputs are considered by commercial teams in the ONE Order build/buy process.

• Getting involved in technology planning, rollout, and roadmap development.

• Input in planning the transition approach as we move from the legacy of RBDs, Fares & Rules, PNRs, eTickets & EMDs to Dynamic Offers and customer-centric Orders.

• Designing an optimised accounting process.

• Meeting auditing and legal compliance. With ONE Order, the airline’s finance team still exists in a complex environment. Their world is characterised by issues such as the integration of financial and sales data, operating with multiple payment providers, and working in markets with very different regulatory regimes.

It also has the same responsibilities, including fast, accurate reporting and seamless settlement; to prepare accounting systems capable of delivering new and innovative products, and it should be ready to accept new services, such as those offered by third-party vendors, in the future.

Simplification is hard work but comes with rewards

The truth is that simplification requires a lot of hard work! Accelya has worked with the industry’s early adopters in both NDC and ONE Order and has helped to develop roll-out strategies. And while every airline has its unique journey, one universal learning is that there are huge benefits for those that take account of the need of all internal stakeholders right from the get-go.

“It’s about tying up everything to get one end-to-end collaborative process so that what was the intention in the frontend is being delivered at the back-end.”

Philip Fernandes, SVP Product Strategy, Accelya

African aviation – another set of crossroads

Time for a right turn

AUTHOR: John Grant Chief Analyst, OAG

The World Cup is now a distant memory, and the success of Morocco was a great result for African soccer showcasing both the skill and resilience of a well-drilled team where everyone accepted their roles and responsibilities. Increasingly, COVID-19 and the global pandemic is also a distant memory and now something we have all learned to live with and adapt our ways of life. As a learning experience then the pandemic was certainly a shared learning and for all of us picking up the pieces after lockdowns, restrictions on travel and our social networking then times have never been harder. The parallels with Africa’s aviation industry run deep but rather like the resilience of us all there are reasons for optimism from the learnings and recovery.

A devastating event

For many airlines, the pandemic was a moment of survival of the fittest and even they struggled! Those carriers lucky enough to have deep cash reserves managed to survive, scarred but not materially damaged; Ryanair entered 2020 with enough cash reserves for a few years and some African carriers had enough cash reserves for a few weeks!

In 2020, Africa’s airlines lost some US$7.7 billion, millions of employees within the wider travel eco-system lost their jobs and some eight airlines went into bankruptcy – although some of those were teetering on the edge beforehand.

In 2022, African airlines are expected to have lost some US$638 million,

with those losses hopefully reducing to US$213 million in 2023. Even allowing for those 2023 estimates to be upgraded as the recovery gathers pace, Chinese travel restrictions to ease faster than expected and with a stronger demand profile, Africa’s aviation industry will continue to be marginal. It is a tough existence but there are signs of hope in all regional markets and a sense that maybe 2023 could be a turning point for the industry, or is that just sheer optimism? Let’s examine the facts.

More airlines than ever – but not the right type and size?

There have never been more scheduled airlines in Africa than there are now,

some 264 airlines from around the world operated to the continent at some stage last year; that is the highest number for many years. Equally positively, 120 of those airlines (45%) are African domiciled airlines, again the highest number over the last twelve years although that is the lowest proportional share since 2010. Alarmingly there were only eight low-cost domiciled African airlines operating and that number has never reached double digits in the history of scheduled aviation in Africa as the chart below highlights. Indeed, only two airlines, Air Arabia Maroc and Egypt have been consistently operating through that time, many others have been and gone.

African Scheduled airline operators by segment 2010 vs 2022

Source: OAG Schedules Analyser

By means of contrast, there were twenty-five non-domiciled low-cost carriers operating flights to Africa with those airlines ranging from Ryanair with over 2.4 million seats to the new Wizz Air Abu Dhabi entry with some 33,000 seats and plans to grow further.

Low-cost carriers struggle to survive

Analysed by market segment it is very clear that both penetration and growth in share of the low-cost airline segment is

very low, particularly in West, Central, and Eastern Africa where more than nine out of ten seats are operated by legacy airlines. The global average for January 2023 is for 35% of all capacity offered to be operated by low-cost airlines highlighting just how far behind the rest of the world African aviation is in embracing what is now a proven industry segment that stimulates new market demand, enhances connectivity, and ultimately drives economic growth.

Any discussion around the low-cost market quickly gravitates towards the difficulties of operating in very regulated markets, stimulating demand with very high levels of taxation, shortages of skilled

resources, and the need to challenge established distribution channels and build direct booking activity. All of these are valid points and are proving very difficult to change but is there a

Legacy / low-cost airline share by Africa regional market 2022

Source: OAG Schedules Analyser

more fundamental issue that needs to be addressed, the thorny area of consolidation and scale.

Operational challenges

For any airline to be successful it needs to operate a diverse network that allows it to weather the inevitable changes in markets as they react to external factors. For some carriers it’s a wide geographic network which provides that resilience, for some it’s a balance between clear business and leisure markets, and for others it’s the creation of bases across a

country or continent that allow resources to be reallocated at short notice.

For most airlines in Africa applying any of those principals is challenging as the capacity hockey stick below shows. In total, African domiciled airlines scheduled nearly 40% of capacity and this is supplied by the five largest airlines, with Africa’s single largest airline – Ethiopian Airways – operating 14% of all capacity alone. For comparative purposes the top five airlines in 2022 had a 38% share of capacity and the largest carrier, Ryanair had a 15% share of capacity. So, whilst

2022 Scheduled airline capacity African domiciled airlines

at a macro level African airlines have a very similar profile to their counterparts in Europe, it is at a more granular levels that the challenges of operating become clear. The average capacity operated per day by an African domiciled airline in 2022 was 2,284 seats whilst the average

number of daily flights operated was 24, again for comparative purposes in Europe the average was 51 suggesting that each carrier has at least twice as much operational scale as those in Africa, and with scale comes efficiency. Another part of efficiency is reflected in the type of

aircraft operated – looking at last year’s data it highlights one of the greatest challenges facing aviation in Africa: the need for small aircraft types. Over two fifths of scheduled flights were operated with Turboprop aircraft while another 20% were operated by regional jets resulting in more than 61% of all flights being operated by aircraft that typically have fewer than 50 seats per flight. For any airline creating a longterm sustainable turbo-prop/regional jet network is challenging, typically requiring high selling fares and high aircraft utilisation and whilst the fares are high the continual punitive taxes applied effectively discourage demand stimulation

in all but the most wealthy or tourist markets.

Productivity at the other end of the spectrum across the wide-bodied fleets of African airlines highlights another series of challenges and inefficiencies. Looking at the current planned first quarter 2023 schedules reveals several carriers operating with a low number of daily wide-bodied services. While airlines such as Ethiopian (114), Air Mauritius (137) and South African (131) are striving for a high degree of operational use, carriers such as RwandaAir, Air Peace and Uganda Airlines appear to be using their aircraft for less than two flights a day, hardly efficient operations by any measurement criteria.

Scheduled flights by aircraft type, African domiciled airlines 2022

Source: OAG Schedules Analyser

Q1 2023 Scheduled wide-bodied services and active fleet sizes, African domiciled airlines

At another set of crossroads?

Post-pandemic with the recovery now in full swing, African aviation appears to be at another set of crossroads, and it would be fair to say it has plenty of experience of such moments but frequently failed to take the right direction. The key question is what the right direction should be and is it possible to make progress that is both sustainable, grows access to travel and importantly creates a profitable industry for all. There is no ‘golden bullet’ to establish that position but perhaps there are some ideas or thoughts to consider. Industry consolidation has often been discussed as a way forward, but it has yet to deliver results for either majority or minority partners in Africa. Disputes over ownership and control, allocation of resources, scheduling, management teams and even pricing have frustrated attempts at any form of consolidation.

The loss of strategic control, protection of national interest and frequent changes of government control have proved difficult barriers to overcome, and many attempts have floundered on ‘majority investment, minority influence’ type arguments. Given the history, politics, and failure of previous attempts then it would be a brave airline CEO to suggest a consolidation play in the near future. But are their other alternatives?

An African airline alliance? Is a partnership approach a more realistic and less emotive means of creating the necessary critical mass and network that a pan-African airline could operate and provide the necessary supporting foundations for the wider airline community to build around? Is it possible to make something happen? Well, there are four very distinct geographic regions

within Africa and in each of those there is a dominant airline operator that has successfully secured enough scale and mass to survive and move forward, could some form of partnership between those carriers be a catalyst for change?

Each of these airlines enjoy strong market positions in their respective regions, in most cases offering at least twice as much capacity as the second largest airline in that region and all having a range of existing partnerships in place with smaller carriers. Post-pandemic many airlines have realised that they were lucky to survive the event, in many cases, without Government support, sympathetic lessors and some savage cuts in resources they would have collapsed. No airline CEO wants to be in that situation again so developing new strategies that de-risk such exposure will be vital in the next few years and

AFRICA’S PARTNERSHIP ALLIANCE

creating strategic but non-equity-based partnerships represent a way forward. Previous partnerships in Africa have always been built around investment rather than recognising the commercial benefits that could be created by working together. But most of those have failed, were those attempts to run before walking realistic? Could softer options have been considered and was too much effort wasted at the negotiating table with too many ‘interested parties’?

Absolutely YES!

Africa’s new opportunity

In the early stages of the pandemic many people uttered the phrase ‘in adversity is opportunity’. However, there is some truth in the sentiment and African aviation now has that opportunity to make a quantum

leap forward in terms of its development, value to economic growth and most importantly connecting a continent that is frequently best connected via Paris or Rome at the moment. To make that happen requires trust but no cash. It requires partnerships rather than ownership. And most importantly it requires inspirational leadership to step forward. But nothing is impossible with the right mindset.

African aviation is once again at a crossroads, the journey to date has been long, impacted by too many detours and stumbled across too many roadblocks as it has attempted to make progress. The latest crossroad is probably the last opportunity in a reset world, can the continent make the right turn?

sed diam nonummy nibh euismod tincidunt ut laoreet dolore magna aliquam erat volutpat.

WORK STEP 4

Figure 1: Potential partnership structure for African aviation

Quo vadis, airline customer experience?

The revival of the digital passenger journey post-pandemic

AUTHOR: Mirko Kopf Associate Consultant Customer Experience at Lufthansa Consulting

New technologies enter the airline industry at fast pace. Airlines need to adapt and upgrade their product to stay relevant. Passengers prefer to fly with an airline that finds the right balance between digital and human touchpoints. In a fast-moving environment, making the right investment decisions becomes increasingly challenging. With digitalisation gaining momentum, airlines need to follow the call for a more digital customer journey. Africa’s airlines have entered the path of recovery and embarked on the journey of digitalisation with many good examples leading the way. Systematic assessments help to adapt to ever evolving customer needs by identifying and prioritising investment areas.

Airlines are forced to enhance their product experience with new innovations entering the industry

Rising up from the severe impact caused by the COVID-19 pandemic, the airline industry is sure to find its way back to pre-pandemic standards. According to AFRAA’s Annual Report 2022, the year 2021 heralded a period of recovery with traffic continuously increasing. OAG data confirms that as of March 2023, overall seat capacity (in terms of available seat kilometres) in 2023 are projected to reach almost pre-pandemic levels.

This, and former crises (e.g. 1973 oil crisis, 9/11 and the 2007-2008 financial crisis), show that the industry always manages to find its way back to recovery and growth. Still, in the phase of recovery, many airlines, especially European carriers, had to face chaotic ramp-up and challenging operational environments during last-year’s summer operations. So, what is there to take away at this stage? The industry seems resilient and with a lot of energy, it will get back on track. However, trends that were urgent pre-pandemic are still valid or have even gained importance. One of these trends is the call for a more seamless and hassle-free travel experience. Airlines around the world have recognised this trend and are upgrading their product experience by driving digital development. Hawaiian Airlines and airBaltic are entering the latest stage in highspeed inflight connectivity by teaming up with Elon Musk’s Starlink. Star Alliance encourages its members in the usage of biometrics and many airlines follow the call for digitalisation by introducing self-service digital touchpoints. African carriers are also embarking on the journey of innovation. Ethiopian Airlines partnered with Immfly, a Spain-based provider for digital on board software and solutions, to bolster up the inflight e-commerce and connectivity experience. Together with Clickatell, a frontrunner in chat commerce and mobile messaging, FlySafair offers a convenient payment solution via WhatsApp through a pay-bylink capability. Customers can checkout their purchase by receiving a secure link directing them to a payment page. In times of high popularity of mobile messaging and mobile payment this solution provides an enhancement to the digital travel experience.

The industry is not standing still. Extended reality (including virtual and augmented reality) and robotic assistants are just two of many fascinating innovations which will impact the future passenger journey – all with the mission to smoothen operations and improve customer satisfaction.

The aviation industry experienced a paradigm shift within the last 12 months. Disrupted processes and slow ramp-up around the world impacted passengers’ satisfaction and trust. With recovery underway starting last year, the strategic focus shifted from financial survival and rigid cash management to stable operations and improved customer experience. And, it is now time for airlines to revamp their product, in order to not fall behind the competition.

Africa’s digital ecosystem embarks on a journey of growth

Whilst traffic projections give reasons to be optimistic, other factors also indicate a promising future. The Agenda 2063 by the African Union provides a clear way forward – also in terms of digitalisation and connectivity. Aiming to have a worldclass infrastructure across the continent, the agenda targets ambitious growth in internet connectivity, broadband access and mobile penetration. Paired with a young demographic structure (median age of <25 years) and growing digital affinity, the information and communication technology sector will play an increasingly important role.

Africa’s tech startup scene pictures this development well. With more and more Africans gaining access to the internet and mobile phones, a wave of startups has emerged across the continent.

According to a recent article on disruptafrica.com, in 2022, a total of 633 African tech startups emerged, which is already double compared to 2019, as reported by the German Institute for Global and Area Studies in 2022. Last year, techcabal.com posted that the continent is now home to seven unicorns. Whilst the tech scene is still nascent and small compared to worldwide heavyweight ecosystems like the US, the dynamic in Africa is evident and the ecosystem is amongst the fastest-growing in the world, Financial Times published in its ‘Africa’s fastest growing companies 2022’ ranking.

This evolution also taps into the airline industry. With an increasingly digitally savvy population and new technologies emerging, African airlines need to recognise the change in customer behaviour and adapt their product experience accordingly to meet expectations. Airlines that do not

acknowledge the importance of an increasingly digital customer journey and challenge their current digital maturity may risk falling behind in mid-and long-term.

Africa’s airlines catching up in digital product experience

Africa’s main carriers understand the importance of digitalisation and have already taken the first steps. The number of African social media users has risen continuously amounting to 384m users as of 2022, Statista released in its ‘Social media in Africa – statistics & facts’. Facebook is still predominant with a market share of >80% as of 2022. Social media is a crucial channel along the customer journey as it provides content for marketing purposes but can also be used as an effective platform for interaction and social selling. A well-managed social media platform

provides a focal entry point into the customer journey. Africa’s top airlines are present on Facebook and other channels with considerable follower bases (e.g. Ethiopian Airlines: 3.1m, Egyptair: 1.7m as of March 2023).

A smooth and seamless booking flow improves conversion and retention rates. An efficient online booking process can be, for example, assessed through the number of clicks required to book a flight. This metric goes into the core of digital experience. Simplistic and intuitive booking flows are the essence of a successful user experience. The Spanish airline Vueling has mastered the process, offering the most convenient and seamless online booking experience with only 16 clicks required to book a flight (see figure). Compared to this benchmark, Kenya Airways performs extremely well (19 clicks), outpacing industry leaders such as LOT or KLM.

Assessing digital maturity requires a comprehensive view

Contrary to common perception, achieving digital maturity is more than introducing digital features. Whilst these certainly are visible from the customer perspective and impact customer satisfaction, the topic is much broader since non-visible factors are equally important. Internal enablers are crucial to drive digital maturity. Digitalisation and innovation require an environment in which each and everyone involved is eager to challenge and push the boundaries. In a fast-paced environment, flexibility, the willingness to acquire new digital skills and a culture of innovation are key. In a cross-industrial survey amongst UK companies, the Learning & Work Institute in 2021 stated that 76% of employers acknowledge that a lack of digital skillsets will affect their future profitability. Visionary leadership with a clear goal and roadmap is a first step in the right direction, but only worth a fraction if not put into practice. Empowerment and forward-thinking need to be promoted to encourage employees to carry out the vision in their work routine.

To drive digital maturity along the customer journey, airline managers need to critically reflect and examine three core areas:

1. Does the digital experience already reflect current industry standards and opportunities to address today’s and future passenger expectations? What areas along the customer journey require product investments?

2. How deep is digitalisation anchored into the organisation and strategic agenda? Do we have a vision and clear targets defined for the future?

3. Are our employees equipped with the right skills and tools? Do we have an innovative culture and work environment?

A step-by-step status quo assessment along the customer journey is the first phase in the process. It helps to identify gaps to industry best-practice as well as competitors and supports the definition of a desired target picture and concrete actions. And whilst the digital experience is significant and shapes the overall customer journey, the target picture for each airline may look different.

Considering elements such as business model, operational environment, or even macro- and socio-economic factors is essential in painting the future picture.

Choosing where to invest becomes increasingly challenging

In this highly dynamic environment, airlines need to continuously re-assess their digital strategy. New technological innovations force airlines to adapt their product experience to stay relevant, since passengers prefer to fly with an airline that combines best digital and human service elements. Strategic decisionmaking becomes increasingly challenging. Knowing which investments to prioritise helps to make smart and efficient decisions to position the airline ahead of the competition. Time is a valuable asset in this context, as changes and turnarounds will not materialise overnight. Undergoing digital transformation unlocks a rewarding return. According to an MIT Sloan study, companies undergoing digital transformation achieve net margins of 14.0 percentage points above industry average. Methodologies and tools exist to understand where to start and which steps to take first.

Digital maturity assessments help to identify improvement potentials and defining next steps

Systematic approaches exist to identify improvement potentials in consideration of industry best-practice. Digital maturity assessments are no new invention but have already proven themselves in various sectors and provide a framework to determine the individual maturity and improvement areas. By applying scoring and clustering methodologies, these assessments provide an effective and transparent diagnostic. Given the dynamic industrial pace, regular status-quo analyses help to determine next steps, prioritise investments and make timely strategic decisions in order to stay ahead of the competition.

Finding the right balance

Passengers call for a smooth and hassle-free experience. A digital customer journey helps airlines to meet the expectations and positively impact customer satisfaction. However, the individual digital maturity level also depends on several external factors. Despite the accelerating trend of digitalisation, passengers do seek human interaction in the form of individual attention, courtesy and helpfulness in certain moments. Nonetheless, digitalisation is on top of the strategic agenda and a crucial differentiating factor. The developments prove that Africa’s carriers have embarked on a promising journey of digitalisation with many good examples leading the way and it will be pivotal to persevere along this journey. Reviving digital customer experience therefore remains key to overcome the challenges of the modern airline world and pave the way towards a successful and sustainable future.

A digital customer journey helps airlines to meet the expectations and positively impact customer satisfaction.

Female wings in African airspace

Women are still the distinct minority in aviation professions on the African continent. Maseka Kithinji explored the reasons in her master’s thesis written at Austria’s Danube University Krems.

AUTHOR: Ms. Maseka Kithinji

In December 1903, powered aviation was launched by the Wright brothers. While aviation pioneers took the world by storm, the reservations that flying women faced grew just as quickly. Despite this, a few female pilots managed to break into the domain claimed by men. Harriet Quimby, the first woman to cross the English Channel in 1911, and the famous Amelia Earhart a decade later, are examples of those female aviation pioneers.

Women’s interest in the aviation industry was not unique to the Western world, but was soon sparked in Africa as well. Two decades after the first woman took to the skies in Europe, the first female pilot conquered African airspace. Lotfia Elnadi was not only the first African, but also the first Arab female pilot. She acquired her pilot’s license on 27 September 1933, after enrolling in an Egyptian flight school. After these initial milestones, the path into the cockpit for African women was led primarily through the military. In 1963, for example, Melody Danquah of Ghana was among the first three women to be trained as pilots in Ghana’s national air force. Years later Asli Hassan Abade in 1976 from Somalia followed suit and became

an Air force pilot in Somalia, to date there has not been another female aviator that has been able to join the Somali air force due to the political atmosphere in Somalia. One of the most important factors in the development of African women aviators was the independence and social progress of African nations. In East Africa, Kenya’s Irene Koki Mutungi became the first female pilot to fly with the national carrier, Kenya Airways, beginning in 1995, and remained the only one in her field for the next six years. In 2004, she became the first African woman to captain a commercial airliner – first a Boeing 737, and later a 787.

Today, in the 21st century, women are still a minority in highly skilled positions in the aviation sector. IATA’s 2022 statistics provide data on the number of women in aviation worldwide. For example, women make up six (6) percent of CEO’s, five point eight (5.8) percent of pilots, less than nine (9) percent of aeronautical engineers, and eighteen (18) percent in the flight dispatcher category. The master’s thesis prepared by the author of this paper is the first academic study to specifically address the issues of women in African aviation, specifically in Kenya and South Africa. It shows that wide economic disparities, cultural history and social upbringing are just some of the unique challenges facing young African girls. For example, when they want to enter the aviation industry, many lack male or female role models who could point them toward or guide them in a career in aviation.

Women interviewed in the study who had made an entry into aviation careers said they had struggled with overt or subtle biases during training. Among them were comments from instructors such as,

Harriet Quimby

Amelia Earhart

Irene Koki Mutungi

Harriet Quimby Melody Danquah

Asli Hassan Abade

Harriet Quimby Lotfia Elnadi

‘Women are difficult or slow to train,’ or, ‘Girls hurt themselves easily.’ In South Africa, racist remarks were also often made. Among them: ‘These black girls are troublesome...’

However, the biggest challenge in finding a job for African women is not gender, but the few jobs available. This is compounded by gender bias in corporate hiring processes.

In addition to the nature of corporate culture, another important factor is the importance and influence that family and faith have on women aviators and their career advancement. Numerous respondents expressed the difficulty of being a wife and mother while pursuing a career in aviation. One of the Kenyan participants specifically stated that it was impossible to balance both without God’s intervention. The majority of participants from Kenya and South Africa strongly believe that faith in God has shaped their aviation careers to date, and provided them with employment.

A participant from South Africa pointed out an interesting perspective on the topic of family and aviation. She expressed that the difficulty of finding a spouse and starting a family as an African female aviator is a decision influenced by male and African culture. The idea that ‘women don’t want to have children’ or the unspoken ‘African rule’ in households that ‘women should take care of the homestead’ influence the decision for, or against, a career in aviation. Thus, starting a family can simultaneously mean the end of a career in aviation.

The biggest challenge for women in African aviation is accessing the opportunities available to them. This begins with the application process, continues with training, and extends

to everyday work and opportunities for advancement. The existence of educational institutions, the quality and type of training offered, and the suitability and availability of jobs are all important. From the data presented globally on this topic – and the African perspective – it is clear that the challenges faced by women in aviation are not limited to continents. A negative work culture prevails in many companies, work-life balance is problematic, and the negative impact of the pandemic on the labour market is still a dominant issue, especially in Africa. While the corporate culture is inherently competitive, the implicit bias and discrimination against women in many places leads them to leave employment early.

This article is based on a master’s thesis by Maseka Semo-Olesi Kithinji titled, The Aviation Industry in Africa: An Analysis of the Challenges Women in Aviation Face in Kenya, South Africa and Other African Countries in the Department of Business Administration, Professional MBA in Aviation Management at Danube University Krems, Austria.

The Aviation Industry in Africa: An Analysis of the Challenges Women in Aviation Face.

MixJet Flight Support Leaders Drive Aviation Industry Advancement Through IASO Collaboration

MixJet Flight Support is a distinguished aviation services company that has made its mark in the industry under the astute guidance of its CEO, Mr. Munir Khalifa, and EVP, Mr. Shukri Khalifa. Both are regarded as stalwarts in the aviation sector, with a wealth of knowledge and expertise in aviation services.

Mr. Munir Khalifa commented on the significance of flight support in the aviation industry: “Flight support is a critical component of the aviation sector, encompassing several disciplines that require a high level of expertise and knowledge to provide comprehensive support to the aviation industry. MixJet Flight Support takes pride in being a premier provider of aviation support services globally.”

Mr. Shukri Khalifa, the EVP of MixJet Flight Support, added, “We believe in innovation and keeping pace with the latest technologies and trends in the aviation industry. Our focus is on providing high-quality services to our customers and ensuring they enjoy a seamless experience. Our team works relentlessly to provide end-to-end support to our customers, from flight planning to on-ground assistance.”

In addition to serving as CEO of MixJet Flight Support, Mr. Munir Khalifa is also the founder of the International Aviation Services Organization (IASO). This non-profit organisation aims to organise, educate, and enhance the aviation services industry by fostering collaboration among aviation services companies worldwide. Through IASO, Mr. Khalifa has played a pivotal role in promoting best practices and providing a forum for consultation on industry issues, leading to substantial improvements in the aviation services industry.

MixJet Flight Support, as a founding member company, is delighted to support IASO’s mission to enhance the aviation services industry. Later this year, IASO is organising an event to introduce the organisation to a broad audience in the region and the world, creating a tremendous opportunity for members and non-members alike to network, share knowledge, and discuss improvements within the industry to make a more sustainable and business-friendly environment.

This upcoming event will provide a platform for industry professionals to share insights and explore opportunities

for collaboration while keeping abreast of the latest developments in the aviation services industry. It promises to be a spectacular affair, with MixJet Flight Support leading the way in promoting best practices in aviation services and ensuring the highest level of credibility and representation for IASO members. The dynamic leadership of Mr. Munir Khalifa and Mr. Shukri Khalifa has propelled MixJet Flight Support to the

forefront of the aviation services industry. Their commitment to IASO is instrumental in promoting best practices in the aviation services industry and ensuring credible representation for all members. The forthcoming event provides a unique opportunity to learn more about IASO's work to enhance the aviation services industry and build a network of likeminded professionals passionate about advancing the sector.

We believe in innovation and keeping pace with the latest technologies and trends in the aviation industry.

20th anniversary

Kiu System Solutions

This year, 2023, marks the 20th anniversary of Kiu System Solutions, a company that provides a robust and innovative PSS and suite of airline solutions. Our structure combines the best practices of both Legacy and Low-cost systems, therefore, we offer the only new generation hybrid and multi-hosting system that exists in the market today. Today, Kiu System Solutions sits amongst the top 10 PSS providers worldwide.

Kiu, or Knowledge in Use, was born from a lifetime of experience within the travel and tourism industry, with very specific experience gained from airline operations. Alberto Desimone, the CEO and joint Founder of Kiu, has spent a lifetime in travel and tourism which started in 1983, where he founded a wholesale and retail tour operator which rose to become amongst the top five tour operators in Argentina. This fascination with the industry extended and, in 1987, one of the largest tourist attractions in Argentina, ‘Train to the Clouds’ was acquired and operated. 1990 saw a further expansion with the formation of Dinar Airlines, a scheduled and charter air operator which established a wide route network to 40 destinations, both

domestic and international from its base in Buenos Aires. The airline operated a fleet of MD83 and Boeing 767 equipment and quickly commanded 25% of the scheduled air service market and 70% of the charter market operating over a hundred charter flights a week. At the time of its sale in 2002, Dinar Airlines had risen to rank as number 109 in the top rated companies of Argentina with an annual turnover of USD $250 million and a staff complement of over 1,000 employees.

During the years of Dinar Airlines, Alberto Desimone, along with Walter Procofio ‘who later went on to become the co Founder and COO of Kiu System Solutions’ identified a gap in the market for an innovative PSS and additional suite of solutions for airlines. Its objective was to support the distribution and selling process of airline inventory while providing friendly tools to improve the passenger experience at all stages and touch points while at the same time cutting distribution costs for the operator. In 2003, Kiu was born and the journey of the business as we know it today commenced.

As of March 2023, Kiu hosts 7.13% of the world’s airlines directly in the Kiu PSS across 33 countries on four continents. We operate our own GDS (code C1) which currently is used by 34,000 travel agencies in our key markets. Our reach across the globe is further enhanced with relationships with indirect distribution and ticketing solutions which enables us, through Kiu GDS, to maximise the presence of our customers globally and increase their sales without the use of legacy GDS systems which comes with all associated costs. Today, Kiu has a vision

to be ‘a world leader in new generation systems’ and to ‘process five percent of the world passenger market’.

Kiu GDS is somewhat unique to our business essentially since we operate our own fully-fledged GDS system (C1). The GDS features the same system functionality as a traditional GDS with no compromise on system functionality. Currently Kiu GDS holds the inventory of 152 airlines in 80 countries. Our airline customers distributing through Kiu GDS have budget certainty that costs are understood and known in regards to GDS activity in that no costs are involved for the airline or the travel agency until a passenger boards a flight at which point a boarded passenger fee is applied – this makes our GDS a very low-cost distribution channel. Within our PSS and GDS we operate our own e-ticket server and EMD-S/EMD-A server and operate in full conformity with the IATA standard. In our low cost model of business, fares are held directly within the PSS or where a customer wishes to have wider distribution through other channels, the operator may fare files through ATPCO. Kiu PSS and Kiu GDS operate in two different interfaces. Firstly we offer the graphic user interface called Kiu-Click which is very simple to use and easy for non-experienced airline or travel agency staff and is very similar to the customer experience when booking online through an internet booking engine. The second interface is the cryptic interface where traditional GDS entries are used to book and issue tickets. The cryptic interface accepts both Amadeus and Sabre commands so individuals with experience on such systems can very quickly work in the Kiu environment with minimal training.

We offer the graphic user interface called Kiu-Click which is very simple to use and easy for non-experienced airline.

Both interfaces are available to our customers but also to all travel agencies using Kiu GDS.

Over the years, Kiu has primarily been built on the extensive experience of its employees, ninety percent of which originate from the airline industry coupled with out-of-the-box thinking technical development staff managed by Walter Procofio, COO and joint Founder, who manages the development of functionality and maintains our leading edge hybrid system to ensure we are always current, stay a step ahead and bring innovation to the market while ensuring that we are always responsive to the needs of our customers and the industry. Kiu operates fourteen offices worldwide with a team of approximately 160 employees.

The head office is situated in Buenos Aires, Argentina with a secondary office in Montevideo, Uruguay and customer support and representation offices in Venezuela, France, Spain, the UAE, Bangladesh, South Africa, Portugal, the United Kingdom, Burkina Faso, Peru and Bolivia.

While we offer a comprehensive PSS with over 3,000 functionalities, we complement this with a full suite of integrated solutions:

• Kiu E-Commerce

• Kiu DCS

• Kiu GDS

• Kiu Admin (Revenue Accounting)

• Kiu Cargo

• Kiu Loyalty

• Kiu BI (Business Intelligence)

• Kiu Maintenance

• Kiu Operations

• Kiu Mobile App

• Kiu Web3 (a new distribution platform based on blockchain infrastructure and crypto currency).

In selecting Kiu as a PSS provider, our customer can custom build the system that they need to meet the requirements of their business. As the business develops, additional functionality can be added or specific solutions can be added to suit their changing needs. Our PSS is able to support legacy, low cost, charter and startup operations – and we always believe that no company is ever too small for our suite of solutions. We fully support unilateral or bilateral codeshare and interline operations as well as distribution through the legacy GDS systems.

Our client base and footprint in the market was launched in South America and grew exponentially. There was a

natural connection with Spain and thus our footprint organically reached Europe. This was followed by entry into Middle Eastern and Asian markets and an uptake of our PSS on the African continent. With increasing competition and rising costs, our multi-hosting hybrid system provides the necessary tools to airlines for commercial success. In the last three years, we have attracted 39 new clients which represents a 90% growth over 2019. It seems that the industry is tiring of the high cost associated with traditional distribution channels and seeks alternative solutions which offer excellent value and functionality propositions supported by excellence in customer service and support.

When COVID-19 arrived on our shores not only was the airline industry hit with catastrophic conditions, but this extended to its support partners. Our primary income is derived from the volume of flown passengers in our network in that the majority of our income is derived from boarded passenger fees and so needless to say with few passengers in the air, our revenue stream was significantly reduced. As we realised that COVID was not going to be a short-term hit, we made a decision that there was an opportunity during this period to further develop our products and thus deployed our teams on projects for the future. We continued with integrations for airlines however we could no longer travel and be on site for training and migrations as was always the norm in this industry. This forced us to explore online tools that would allow us to provide training and support in an effective way for our customers with the reassurance that there was no reduction

in overall quality of the product. Today, our customers tell us that they prefer this solution as it is flexible, allows larger numbers of people to attend training from multiple locations simultaneously and reduces the typical costs and logistics associated with training, those being staff travel, hotel and per diems and managing staff workloads for longer periods of time. We took this a step further and made significant investment in our online help platform. Today our help and support platform is extensive allowing not only operators using our PSS but also travel agents using our GDS to download manuals, chat in community groups, create tickets to report system issues and further track progress, but more importantly we developed a tool and increased staffing levels so that we now offer 24/7/365 human support. At any point while on the help platform, the travel agent or airline agent can request an immediate call back and in seconds, one of our customer service representatives will call in live time allowing a full discussion and in most instances an instant resolution of a problem is achieved. Customer support is multilingual. Today we believe more than ever that excellence in customer support and service is a differentiator for Kiu in our sector.

Another differentiator within our suite of solutions is Kiu BI or our Kiu Business Intelligence module. This is an information platform that allows the airline to see in real terms the performance of flights as far out as 330 days from departure in terms of sales, reservations and flown data. The system is updated every fifteen minutes. All sales channels are captured

and updated at this frequency so the airline has the real picture of performance and can make operational decisions based on robust data. Its robust and flexible database has the capacity to generate statistics according to individual operator needs.

Our revenue accounting solution, Kiu Admin, is very comprehensive and can work as a stand alone solution. We have clients hosted in legacy systems who have chosen Kiu Admin because of its comprehensive functionality and ability to integrate into other systems. Some additional facts:

• Kiu PSS features over 3,000 different functionalities.

• Kiu is cloud based using Amazon Web Services with redundancy.

• There is minimal latency due to servers located in both North America and Europe.

• Customers receive updates of the system at no cost.

• The system requires minimum bandwidth requirements.

• We support a catalogue of over 400 different ancillary services all supported by ATPCO for the sale of ancillaries allowing an operator to

maximise revenues in creative and different ways. Ancillary services can be sold at all points in the travel experience both pre and post ticketing and and during checkpin and is achieved with the issuance of an EMD-A or EMD-S as may be applicable to the specific service or product.

• Our DCS is approved in common airport platforms (CUTE) SITA, ARINC, Ultra, Resa.

• We offer Interline Through Check-in (IATCI).

• We manage APIS or PNRGOV as required.

• Our PSS fully supports interline agreements, unilateral and bilateral codeshare, Interline Through Check-in (IATCI) and connectivity with other GDSs.

• We have developed a tool unique to Kiu to specifically manage hard and soft block sales in seamless fashion. This tool is called Kiu Allotment Manager (KAM).

• The operator manages the system back end so the operator is not dependent on Kiu when changes are required although we are always there to help – 24/7/365.

Going forward, there are a number of projects in development. Firstly, through our relationship with TravelX, Kiu will launch a new product, Web3, a product that works with crypto currency and blockchain technology allowing us to be the first PSS to offer distribution through this channel. Another project will be the release of Kiu GDS Direct to the market as a standalone product which will allow airlines using any PSS in the market to distribute their own product through our platform with immediate access to our network of travel agencies already using our system.

For a more comprehensive understanding of our system visit our website at www.kiusys.com where you are also able to make contact with us. You are also welcome to contact our Commercial Director for Africa, Rodger Whittle, by e-mail at rwhittle@kiusys.com

Passion to create a sustainable future

As the world’s priorities change to focus on environmental impact, Embraer is doing everything possible to make sure E-jets are some of the most sustainable aircraft in the sky –and have been doing so for some time.

It is not just the aircraft – the commitment to sustainability is at the core of Embraer’s entire production chain, from processes,

facilities, to the supply network. It was the first company in the aviation industry to achieve the ISO 14001 in Dow Jones Sustainability Index standard certification for its Environmental Management System in principal facilities and continues to lead with some of the industry's most robust ESG goals to date

Innovation is in our DNA Embraer believes that the transition to a low-carbon economy and the need to adapt air transportation to this new model represents a great opportunity. The aircraft manufacturer is stepping up the efforts to minimise the carbon footprint by remaining dedicated to innovative

solutions that have a broader impact on customers, local communities, and on the aircraft. Embraer aims to decarbonise its direct and indirect operations by focusing mainly on carbon reduction and efficiency. Excluding product use, the Scope 1 and 2 emissions are estimated to account for close to 75% of the company's footprint

which is why it is the priority in this space. On top of that, considering product use, since the aircraft that we design and build account for meaningful carbon emissions, it's imperative to innovate designs and technologies with sustainability in mind. Toward this goal, we aim to bring best-inclass aircraft to market at an accelerated pace to help customers and partners meet their climate goals. This is a team effort, and we must work across industries and borders to address the climate crisis. –said Daniel Galhardo Gomes, Product Strategy Director at Embraer Commercial Aviation.

SUSTAINABILITY IN ACTION.

Net zero carbon emissions by 2050. Making regional aviation cleaner and quieter. Our sustainability roadmap and product development plan have been constructed to help us achieve these goals. Our new generation E2 is the most fuel efficient single-aisle aircraft in the market today with a potential reduction of CO2 emissions up to 30%. In 2025 we are planning the first flight of our hydrogen-powered electric demonstrator.

Between 2027 and 2030 expect to see our next generation turboprop and E2 flying 100% SAF compatible. By the

mid-2030s we are planning to introduce the sustainable Energia family of aircraft, powered by revolutionary propulsion architectures. 2045 will likely see the flight of our first hydrogen-powered turboprop and finally, in 2050, a hydrogen-powered E2 or similar sized aircraft will take to the skies.

Undoubtedly these are bold and ambitious steps, but with over 50 years of market knowledge and expertise behind us, we are confident that we will deliver what we set out to do, transforming the way we all fly.

Design for Environment is an important driver of innovation at Embraer. It prioritises resources and processes with low environmental impact, minimises energy consumption and materials used, optimises product and materials lifecycle, and facilitates disassembly for reuse and recycling as part of a circular economy. Multidisciplinary Design Optimization is Embraer’s key performance indicator approach to aircraft design which has an eye towards efficiency and reducing carbon footprint. This process ensures optimal performance and is built into every design from the start with aerodynamics, aero-propulsion optimum integration, and light-weighting of airframes as part of Embraer’s core multidiscipline design optimisation process that drives down aircraft energy usage and improves CO2 emissions savings. The company also cuts emissions by eliminating the autoclave process for its thermoplastic composite materials, which can save up to 40% of energy consumption during the manufacturing process.

Disruptive technology, radical new aircraft, and electric propulsion

While there has been a 2% per year fuel burn reduction since 1970, combustion engines are reaching their fuel efficiency limit. To design for the lowest carbon propulsion, we cannot rely on just swapping equipment or fuels in current aircraft designs. Rather, Embraer is taking a system-thinking approach to go beyond ‘tubes and wings’ to a whole redesign of what the future of aircraft can be. Right size, right weight, right propulsion –Embraer is engineering a full revision of what aircraft of the future can and should be to truly advance a climate-neutral pathway for flight.

Embraer joined the Target True Zero initiative launched by the World Economic Forum (WEF) as part of the commitment to achieve zero-emissions aviation goals through new propulsion and fuel technologies. The initiative will identify ways to accelerate the deployment of zero-emissions aviation by leveraging electric and hydrogen technologies. Small aircraft, meaningful impact It will take an all-in approach when considering efficiency technology, so it’s important to align the best energy alternative with the appropriate design. This alignment will maximise carbon savings, dependent on aircraft size and type, to drive peak performance and optimal footprints. Embraer believes it can make the most significant impact in small and regional aircraft with that in mind.

• Regulations have changed, allowing small airplanes to move to electric, so Embraer is working to bring this technology to market.

• The new era of electric aviation should start with small and regional aircraft rather than larger jets.

• Embraer has a strong record of safety, proven technological capability, and know-how to get equipment certified for use faster.

• Embraer believes that electrification is another way to facilitate the opening of new markets with intercity mobility and open more doors to underserved economies.

Prioritising the energy transition of regional aircraft can offer gains in efficiency while reducing emissions and costs that make it possible to provide additional routes while creating access to underserved communities and rural areas. In the U.S., over 5,000 regional airports are not in active use as current fleets in the marketplace are not costeffective with the business-as-usual model. Using existing infrastructure to reinstate more regional service, Embraer aims to revolutionise the market with new technology and fleet options that can enable more efficient routes – reducing total overflown miles and associated fuel usage – all while allowing airlines to stay cost-competitive and profitable.

Research collaborations on SAF

Until future technologies are available on the market, SAF will play a key role in reducing aviation emissions in the short and medium term. Embraer has a history of alternative fuel innovation, with our first ethanol-powered aircraft certified back in 2004. The manufacturer promotes the development and adoption of biofuels, mainly SAF, by sponsoring research and development through multipartner engagements. We partner with BioValue and BECOOL multi-stakeholder conveners of academia, the private sector, and research laboratories to help make our aspirations into realities. Together, we have advanced biofuels, SAF, and the

technical, economic, environmental, and social assessment of various biomass production systems and biorefinery configurations. Embraer had begun the use of SAF in its U.S. operations starting in 2021.

Embraer’s goals to shape the green future of aviation

Carbon Neutral operations by 2040 –Scope 1+2:

• Aligned with Paris Agreement goal to limit global warming to 1.5 degrees Celsius.

• 50% reduction in net carbon emissions by 2040 from a 2018 Baseline.

• 100% energy from renewable sources by 2030 and intermediate goal of at least 50% renewable by 2025.

• Begin using Sustainable Aviation Fuel (SAF) in 2021 and aim for at least 25% by 2040.

• Offsetting any residual emissions that will not be reduced through efficiency

projects, available alternative energy or advancing technology.

Carbon-Neutral Growth from 2022 (2021 baseline) – Scope 1+2:

• Commit to capping carbon emissions to 2021 levels while growing operations.

Net Zero Aviation by 2050 (Scope 3) will be achieved by:

• Developing products, services, and disruptive sustainable technologies including electrification, hybrid, biofuels including SAF and other innovative energy alternatives.

• Working together with suppliers to make our current aircraft compatible with the use of 100% SAF.

• Actively working with the supply chain to expand the global SAF production scale.

• Continuously improving the efficiency of our current aircraft until the certification of new technologies.

Launch zero-emission eVTOL aircraft by 2026.

Embraer aims to revolutionise the market with new technology and fleet options that can enable more efficient routes.

Airlines taxes and charges in Africa article on study done by the African Airlines Association

Introduction

The COVID-19 pandemic unprecedently marked the year 2020. The global economy almost stopped, resulting in a 3.5% contraction, the worst performance since the 1930s. Since early 2021, the global economy is gradually recovering with the ease of many restriction measures. The GDP rebounded by 5.7% last year, and the growth is expected to continue, despite an anticipated slowdown due to the Russia-Ukraine war and its economic repercussions.

The travel and tourism industry was particularly impacted: with the borders closures, travel bans, and lockdowns taken in almost all countries worldwide, the number if international tourist arrivals dropped by 72.8% in 2020. Unfortunately, 2021 was another challenging year for the industry, as the number of international tourists rebounded by only 9%. In Africa particularly, the rebound compared to 2020 was insignificant: 0.8% only.

Air passenger traffic progressively returns to its 2019 levels. In 2021, global airlines carried 2.2 billion passengers, while African airlines carried 43 million.

According to the ATAG (Air Transport Action Group), the COVID-19 outbreak put at risk 44.6 million jobs and reduced

the contribution of the aviation industry to the global economy by 49% in 2021 (from USD3.5 billion to USD1.8 billion).

43 Million passengers (estimations)

61% Passengers LF (estimations)

1.9% Of the global aviation industry

3.8 Million Jobs supported

$27 billion Contribution to GDP

47.6% Cargo LF

Source: AFRAA - IATA - ATAG

Figure 1: Air transport in Africa

It is therefore imperative that aviation regains its initial level of performance, and reaches the level of growth that was forecasted before the disruption.

The challenge is greater in Africa, where the economic environment is difficult. African airlines face several challenges, including the high level of taxes and charges. In fact, air transport is perceived as luxury service across the continent. Then, governments tend to overcharge the travelers with taxes. As a result, air tickets are expensive and most African citizens cannot afford. It is critical to address this challenge.

The objective of this paper is to benchmark the level of air ticket taxes and charges across the continent and in comparison with other regions, and identify areas of improvement to the benefit of the entire industry.

Scope of the study

The study will review in detail the level of taxes, charges and fees collected on air tickets and paid by the final passengers, in each African country, highlighting the differences between Intra and inter-regional travel. The study will also establish a comparison with 2 (two) neighbouring regions: Europe and the Middle East.

Air ticket taxes, charges and fees in Africa

The aviation industry has a particular fiscal regime. Many specific taxes are applied by states to air passengers for various purposes. Apart from those taxes, some charges and fees are directly applied to air tickets, for cost recovery purpose after services offered to passengers. The figures in the study, representing the sum of taxes, charges and fees applied to air tickets, have been

collected in November 2022 from various sources among which IATA and AMADEUS, and reconciled by AFRAA.

1. International departures taxes, charges and fees

In Africa, air passengers pay on average 3.5 different taxes, charges and fees for international departures, representing an average amount of USD 66. This represents an increase compared to 2020 when the average was USD 64.

Map 1: Average international departure ticket taxes, charges and fees per country

Table 1: 10 (ten) most and less expensive countries for International departures

In the top 10 most expensive countries in terms of ticket taxes, charges and fees, Djibouti is first, followed by Niger and Sierra Leone. Nigeria and Ghana are also part of the list.

The less expensive countries for international departure ticket taxes are Libya, Lesotho, and Botswana. The list of 10 less expensive countries also includes Tunisia, Algeria, and South Africa, which are countries with significant traffic.

Out of fifty-two (52) countries, twenty (20) charge above the continental average. Thirteen (13) charge passengers above USD 100 compared to 10 in 2020, emphasising the continental increase. 20 countries charge USD 50 and more.

When considering African sub-regions, the Central African region is the most expensive, with an average amount of USD 96.5 taxes, charges and fees paid for international departures (USD 89.9 in 2020).

Western Africa is following, with USD 92 on average, an increase of around USD 11 compared to 2020.

Eastern and Southern African regions, even if affordable compared to the previous, remain more expensive than neighbouring regions, charging USD 57.8 and USD 35 per passenger respectively. The same regions charged USD 67.7 and USD 54.1 respectively in 2020.

The most affordable region in terms of taxes, charges and fees remains Northern Africa, where passengers pay an average of USD 29.9 (USD 28.6 in 2020).

Twelve (12) out of the twenty-three (23) countries in Central and Western Africa (more than half) charge more than USD 100,

although the two regions put together represented only 23% of the continental traffic. Most of the Northern African countries which represent 35% of the traffic, charge less than 50 USD 28.6 in 2020).

Chart 1: Average international departure ticket taxes, charges and fees per African sub-region

Table 2: Number of countries by region and level of international departure taxes, charges and fees

2. Regional departures taxes, charges and fees

Some Regional Economic Communities (RECs) adopted preferential rates among their members. As a result, passengers departing for travels within the sub-region pay a reduced amount of taxes, charges and fees, compared to international departures outside the sub-region.

In Africa, the average amount paid for departures within subregions is USD 57.4, which is USD 0.2 less than 2020

Table 4: Countries applying preferential rates for sub regional departures

Central and Western Africa regions have the highest numbers of countries applying preferential rates.

This allows sub-regional travellers to save on average USD 8.6.

Map 2: Average regional departure ticket taxes, charges and fees per country

Chart 1: Average regional passenger taxes, charges and fees per African sub-region

Comparison with neighbouring regions

While the average amount of taxes, charges and fees paid by passengers for international departures in Africa is USD 66, passengers are charged USD 30.1 in Europe and USD 32.5 in the Middle East despite the fact that traffic is much more important in these regions as shown below.

3. Transfer and arrival taxes, charges and fees

Passengers in Africa also pay taxes, charges and fees for transfer and on arrival, as shown in the tables below:

Map 3: Average taxes, charges and fees paid by passenger for transfer in African countries

In Europe, passengers pay on average 2.53 different ticket taxes, charges and fees on departure, 2.69 in the Middle East. In Africa, the number is 3.5.

Only one (1) European airport among the selected charge passenger more than USD 100, and four (4) charge more than USD 50.

All Middle-East countries charge passengers over USD 100, and only two (2) over the twelve (12) charge above USD 50.

41 countries now apply transfer in Africa compared to 35 in 2020, over the 52 selected. Transfer taxes, charges and fees increase ticket price by an average amount of USD 34.5 compared to USD36 in 2020.

Chart 2: Comparison with neighbouring regions

Table 8: Taxes, charges and fees paid by passenger on arrival in African countries

AFRAA / IATA ACIC

Arrival related taxes, charges and fees increased from an average USD 12.3 in 2020 to USD 14.1 in 2022.

4. Example of the effect of taxes on ticket prices for travels in Africa

The examples below show how taxes are affecting the final ticket price.

Taxes and fees generally represent more than 50% of airlines’ most affordable base fares, and more than 25% of total ticket price.

Given the low purchasing power in Africa, it is urgent to assess the issue of high taxes, to stimulate the demand and make air transport affordable to African citizens.

III – Other airport charges paid by airlines in Africa

Apart from Passengers taxes charges and fees that are levied directly on air tickets, airlines have to face many other charges related to their operations at airport level. Some of them are listed below:

• Landing

• Noise

• Parking

• Common User Terminal Equipment CUTE

• Jetway Charge

• Passenger Bus

• Lighting

• Counter

• Fire Fighting and Prevention

• Check - in

• Ground Power Unit

• Ground Handling

• Follow - me

• Terminal

•

and Push – back

The table below shows the charges paid at the main African airports for an international flight with the following criteria:

• Aircraft Type : B737

• Total Departing Pax : 1

• Total Economy Pax : 1

•

• Period of the day

Table 11: Examples of ticket price breakdown for intra-African travels

Map 3: Other charges paid by airlines in African countries

Comparison with neighbouring regions

In comparison with Europe and Middle East, the charges remain lower in Africa. The average amount of non-passenger charges is USD 959 in Europe, and USD 553 in Middle East, as shown on the tables below.

Somalia is the most expensive airport for airlines charges, with more than USD 1800 for an international flight. In the same conditions, a busy airport like Algiers charge USD 140. The average amount of charges paid is USD 578 compared to USD 625 in 2020.

Four (4) airports charge more than USD 1,000 including Somalia, Zambia, Angola and Guinea; while three (3) airports in Africa charge below USD 100: Libya, Lesotho and Eswatini.

From the table above, we can easily see that the busiest countries are among the cheapest. As examples: South Africa, Ethiopia, Kenya charge less than the average.

Chart 3: Average airport charges per African sub-region

Europe Africa Middle East

In Europe, airlines have to pay charges type that does not exist in Africa, such as De-icing, Slot coordination, Water for aircrafts. Other charges like lightning and noise have higher rates.

Middle East rates are closer to African one and the scheme of charges is similar. That can explain why the average amount of charges are close in the 2 regions.

Conclusion

The high level of taxes and charges is a critical issue and it is contra-productive for air transport development in Africa. As air transport is considered as a luxury service, government tend to overtax air transport supply chain leading to excessive service charges to the airlines. The average amount of taxes applied to air tickets is twice more expensive in Africa than in Europe or Middle East.

AFRAA advocate for reducing taxes and charges through effective gains along the entire supply chain to ensure affordable air transport prices and increase traffic growth rates. According to a study realised by our partner Predictive Mobility, the elasticity price/demand for air transport within Africa vary from -2.34% to -3.15%. That means that a reduction of 1% on the ticket price can increase the demand at continental level, from 2.2 to 3million passengers yearly.

On a regional approach we can see that Central and Western African airports are the most expensive. The average amount of charges in those region (USD 632 and USD 669 respectively) exceed the continental average, which is USD 578. Northern Africa is the least expensive region in terms of airport charges with an average of USD 486.

Thus, the reduction of taxes and charges can allow a significant stimulation of demand on the continent. This will help our airline to become more competitive, especially against foreign operators, who are based in regions were the taxation is lower comparatively.

A wealthy air transport industry is necessary for the development of tourism, trade, and of key economic sectors in Africa.

Chart 4: Comparison with neighbouring regions

Uganda Airlines is Flying Clear of Turbulence

As the global aviation industry emerges from the deep impacts of the COVID-19 pandemic, the world’s airlines are projected to post their first profits since 2019. Globally, airlines lost $7 billion in 2022, an amasing comeback from the $42 billion they lost in 2021 and 138 billion the year before.

IATA, the International Air Transport Association, projects that airlines will earn $4.7 billion in profits off gross industry revenues of $779 billion in 2023. That will be driven by a more rational approach to COVID-19 restrictions, higher levels of vaccination against the virus and a better match between capacity and demand for travel.

Because of a large domestic sector and earlier easing of internal pandemic controls, North America is leading the return to profitability. North American airlines were expected to post a profit last year. North America will be followed by Europe and the Middle East this year. All factors remaining constant, airlines in Latin America, Africa and the Asia Pacific region, could see their first profit, post-pandemic, from 2024 onwards.

had started commercial operations. When the breaks were suddenly pulled on international travel, network development, passenger traffic and revenues all took a hit. All the initial business assumptions on which Uganda Airlines’ performance projections were based, were also turned on their head.

AUTHOR: Shakila Uganda Airlines

For startups like Uganda Airlines, the COVID-19 pandemic could not have come at a worse time. The global lockdowns set in a mere six months after the airline

It had been projected that the carrier would be operating 16 routes at the end of the first year; only 10 had been activated at the time lockdowns intensified in March 2020. To date, only 11 routes, including a single intercontinental route are operational instead of 18 including three international routes. Besides shredding revenue projections, the lockdowns and the conflict

in Ukraine, also imposed unexpected costs on the carrier. Globally, the average cost of jet fuel as a proportion of airline costs during 2022, doubled to 24 percent. As an Africa-based operator without a hedging scheme, Uganda Airlines saw much steeper fuel-cost escalation.

Yet despite that turbulent start, the business is now looking up as travel restrictions ease and air travel normalises. The schedule has recovered and in the near future, operations are expected to revert to pre-COVID levels. We are actively pursuing network expansion and there will be some exciting announcements soon. The gap between the projections and performance is also narrowing.

During fiscal 2021/22, some 218,788 passengers were carried against a target of 383,486 passengers. Although that was 43% short of target, it represented a 148% increase in passenger numbers over the 2020/21 accounting period. At the operational level, (the number of routes in operation), the shortfall was 29%. Over the same period, we saw a 172% increase in passenger revenues relative to fiscal 2020/2021 and the budgeted shortfall on active routes only was 25%. The passenger load factor improved by 7 points to reach 45%. Revenues from charter operations expanded 115% over 2020/2021.

We are actively pursuing network expansion and there will be some exciting announcements soon.

Reason for optimism?

Uganda Airlines fortunes are closely tied to the performance of Africa as a region. That is because most of its and nearly 87% of its frequencies are within Africa.

Tourism data also shows that Uganda sources 80% of its tourists from Africa. By inference, better performance by Africa implies better prospects for Uganda

Airlines. According to IATA statistics for December 2022, African airline traffic grew 118.8% over the previous year. Their combined share of the global market rose to 2.1% from 1.9% in 2021.

The carrier will, therefore, see stronger passenger performance as it expands its African network and integrates it with new routes to Asia and Europe to achieve its

hub and spoke. Flying to West Africa is going to be important in this regard. The opening up by China after years of tight restrictions also bodes well for global travel and Uganda Airlines. The regional points will feed our global network and that is the big picture.

Value of aviation to the Ugandan economy

While air transport’s contribution to Uganda’s economy has not been comprehensively studied, aggregate figures from elsewhere, provide a rough picture of its potential contribution; the contribution of aviation is usually fused under the Transport sector. In 2019 for instance, with Africa accounting for only 3% of global passenger traffic, aviation contributed $63 billion to the continent’s GDP and employed 6.2 million people.

According to studies by IATA, air transport contributed $3.2 billion or 4.6% of Kenya’s GDP and supported 410,000 jobs in 2017. That output was based on the 4.8 million foreign passengers that passed through Kenya that year. The sector’s contribution was projected to expand to $11.3 billion, supporting an estimated 859,000 jobs by 2037 if market trends were to remain constant.

At the end of 2017, Kenya was connected to 67 destinations served by 32 airlines. The corresponding figures for Uganda are 27 destinations in 17 countries served by 17 scheduled carriers.

In Uganda, at least 1.5 million passengers travelled to the country by air in 2022. Uganda Airlines accounted for about a third of that figure. The airline also employed 500 people, only 14% of them expatriates. The airline also contributed Ushs 14 billion to tax revenues and spent close to Ushs 1.2 billion in payments to local suppliers.

Profit or loss?

While the public conversation about Uganda Airlines tends to paint a grim picture, the numbers above tell a different story. They show that the airline is on a positive trajectory and is indeed clawing back lost territory. It is also important to remember that the airline is still in the investment phase and at this point, costs will outpace revenues.

Airline profitability and loss come at two levels – operational and absolute. Uganda Airlines will continue to post losses at the absolute level because of the imbalance between fixed costs – which decline over the longer term, and the revenue curve in the short term. Operationally, the airline has been financing some of its operations from revenues generated from passenger operations. Short of unexpected shocks, the airline should achieve operational break-even within the next two to three years, as operations are optimised and market penetration increases.

The major source of cost escalation for Uganda Airlines during the past three years has been stunted passenger growth because of external factors, fleet maintenance costs and sharp increases in the price of aviation fuel because of Ukraine tensions.

African airlines are however exposed to much higher prices for aviation fuel because in 2022, refineries were charging African customers a margin of USD50. On average, African airlines pay 30% more per litre of fuel, than their counterparts elsewhere. There is good news here, that through African Airlines Association(AFRAA).

Uganda Airlines costs are expected peak this year before starting a gradual decline from next 2024. The major drivers of cost escalation will be the launch of long-haul routes to Europe and the FarEast. However, a rationalised and better integrated network, increased traffic, and better aircraft utilisation, will drive costs down.

AFRAA inks MoU with the Kenya Association of Air Operators for mutual support to the development of the airline industry in Kenya

The African Airlines Association (AFRAA) signed a memorandum of understanding (MoU) with the Kenya Association of Air Operators (KAAO) to provide mutual support to the sustainable development of the airline industry in Kenya as the country is represented by the two Associations.

The MoU was signed by Abdérahmane Berthé, AFRAA’s Secretary General and Liz Aluvanze, KAAO’s Chief Executive Officer at a ceremony that took place at the Aero Club of East Africa in Wilson Airport, Nairobi – Kenya.

Under the framework of the collaboration, AFRAA and KAAO will work closely on the following areas of action for the mutual benefit of their membership and industry:

1. Engagement of local authorities and stakeholders on air transport matters;

2. Joint advocacy efforts on issues challenging the airline industry such as: taxes and charges, aviation policy, market restrictions, infrastructure and capacity building;

3. Implementation of the roadmap of the African Air Transport Sustainability Steering Committee (ATSSC);

4. Data and intelligence;

5. Training: Subsidized training courses through AFRAA’s ATO partnership framework;

6. Initiatives on People with Disabilities;

7. Corporate Social Responsibility initiatives and events.

Speaking at the signing ceremony, AFRAA Secretary General, Mr. Abdérahmane Berthé stated: “There are some country-specific opportunities and challenges of the airline industry in Africa that vary from country to country. AFRAA is excited to forge a close working relationship with KAAO as this will enhance the level of support by AFRAA to the airline industry in Kenya. This approach is a building block to AFRAA’s mission for a sustainable, interconnected and affordable air transport industry in Africa where African airlines become key players and drivers to African economic development.”

“As part of KAAOs strategy, we are aiming at developing strong partnerships for advocacy and mutual benefit and this is the first step. We are keen to leverage learnings from AFRAA as they have a pan-African view of the opportunities and challenges faced by the air transport industry in Africa of which Kenya’s robust and dynamic aviation sector forms a significant part of this eco-system”

KAAO Chairman Mbuvi Ngunze added.

The MoU will synergize the efforts by both Associations. AFRAA and KAAO will align periodically to review the implementation of the annual Action Plan and explore areas for further collaboration.

Ethiopian Airlines and AFRAA’s forthcoming Aviation Convention in May set to change the narrative of African airline industry

In light of Africa’s vast landmass, its population accounting for 16% of the world population, and its low share of global trade of 2%, the continent is an excellent opportunity to develop air transport. However, as a market, Africa’s share over several decades has remained stagnant at less than 3% of the world market – it is time to take action to change this narrative.

The 11th Aviation Stakeholders Convention, scheduled to take place from 7-9 May 2023 is timely and aligned to address this situation. The Convention, which is proudly being hosted by Ethiopian Airlines under the patronage of the Government of Ethiopia, will be held under the theme: “Changing the African Aviation Narrative”. The event will bring together over 400 delegates from Africa and across the globe. The Convention is one of Africa’s leading forums for air transport industry stakeholders to dialogue, exchange knowledge and experiences for the development of the travel ecosystem. Several African airline Chief Executive Officers and aviation industry thought leaders will be present at the event.

Speaking in Addis Ababa on the significance of attainment of sustainability that will change the narrative of Africa’s air transport, Mr. Abdérahmane Berthé emphasised the importance of dialogue among stakeholders and collaborative initiatives such as those facilitated by AFRAA: “AFRAA and Ethiopian Airlines are excited to stage this Convention for the travel ecosystem stakeholders to meet, deliberate on strategies to enhance efficiencies, create synergies, develop intra-Africa connectivity, ensure business continuity that will redefine the narrative of Africa air transport industry.”

Mr. Mesfin Bekele, Group CEO Ethiopian Airlines remarked, “We are delighted to host the 11th Aviation Stakeholders’ Convention of AFRAA which will serve as a forum for stakeholders in the industry to put their heads together and discuss the opportunities and pressing issues in Africa’s aviation sector. The forum will showcase the ‘Africa Rising’ mantra manifested in the growing opportunities for all stakeholders in the continent’s aviation industry.”

Event highlights

The Convention will be held from 7-9 May 2023 at the Skylight Hotel in Addis Ababa Ethiopia. A robust and comprehensive programme has been lined up to facilitate discussions on various salient topics, masterclasses, networking opportunities at social events and B2B sessions through a conferencing application. Delegates will have the opportunity to network and discuss developments in the industry and forge business partnerships.

CSR event for youth development in aviation: On 10th May, the Convention activities shall cover a CSR activity aimed at empowering the next generation of aviators at the Ethiopian University. The event will be sponsored by Collins Aerospace and staged in collaboration with AFRAA and Ethiopian Airlines.

Exhibition: There shall be exhibition and showcase of aviationrelated products and solutions at the exhibition segment of the Convention.

Sponsors: The Stakeholders Convention is proudly sponsored by Ethiopian Airlines, ASECNA, ATNS, Boeing, Collins Aerospace and Rolls Royce.

EgyptAir Holding Company Chairman dialogues with AFRAA

6 February 2023, Cairo – Egypt: The African Airlines Association (AFRAA) Secretary General, Mr. Abdérahmane Berthé, met EgyptAir Holding Company Chairman – Eng. Yehia Zakaria on 5th February at EgytAir Headquarters in Cairo – Egypt for the year’s first edition of the ‘AFRAA Member Airline CEOs Leadership Dialogues’.

The CEO dialogues initiative, which hosted a total of 8 airline CEOs in 2022, is part of AFRAA’s strategy to communicate with member’s leadership aimed at creating the space for dialogue that is necessary to develop transformative initiatives.

The deliberations created an opportunity to reflect and exchange ideas between AFRAA and EgyptAir. In particular, on EgyptAir’s plans and strategic direction, the opportunities for intra-African routes through AFRAA route connectivity tool, effective implementation of the Single African Air Transport Market (SAATM), advocacy for optimisation of taxes and charges among other opportunities through AFRAA joint projects which implement costeffective common solutions on various aspects of airline operations for member airlines.

Mr. Abdérahmane Berthé, AFRAA Secretary General stated: “AFRAA is pleased to dialogue with EgyptAir, one of the founding members of AFRAA whose membership spans since 1968.”

“The CEO Dialogues initiative which was started in 2022 has facilitated better understanding of our individual airline needs, local matters and challenges, priorities and business plans thereby enabling AFRAA to tailor specific actions that enhance relevance of the Association to our membership. I look forward to a continued mutually beneficial working relationship with EgyptAir and the entire AFRAA fraternity.”

Mr. Berthé added.

The CEO’s Dialogues are roundthe-year sessions that engage the Member airlines’ decision makers with AFRAA leadership towards effective implementation of

added-value projects and actions supporting members’ sustainability. AFRAA’s actions are anchored on 5 pillars including:

1. Safe, secure and reliable air transport

2. visibility, reputation and influence of African Airlines

3. Sustainable air transport

4. Cooperation

5. Data intelligence

AFRAA

Secretary General Intervention on ‘Financing Sustainable Aviation’

AFRAA Secretary General, Mr. Abdérahmane Berthe in a panel discussion at the 69th ACI Africa Conference on 1st March 2023 in Kigali on theme: ‘Financing Sustainable Aviation’, elaborated on the airlines’ perspective to achieve aviation industry Net Zero 2050 target. He highlighted actions under the following areas:

• Decarbonized Fleet;

• Decarbonized Cabin;

• Sustainable Ground operations;

• Sustainable Flight Operations.

Of significant impact to achieve sustainable fight operations is the AFRAA Free Routing Airspace (FRA) project that is among the 5 projects under the 2022 African aviation industry laboratory.

The FRA initiative beneficial outcomes to the African aviation industry include:

1. Facilitate flights to operate along direct trajectories within Africa thus reduce the fuel burn;

2. Reduce airline operating costs;

3. Boost flight operation efficiency on intra-Africa

market and contribute to productivity gains of African airlines and air navigation service providers;

4. Improve operational industry efficiency;

5. Improve intra-Africa connectivity;

6. Reduce CO2 emissions.

Mr. Berthe further articulated on AFRAA AGA 54 Resolution on Environment which made a call on the following:

1. Call to governments to commit to long term net zero emission goals without compromising the aviation growth potential in Africa.

2. Call to AFRAA members to continue improving their operations’ efficiency to achieve sustained in sector emissions reductions and to support the transition to reliable cost competitive sustainable aviation fuel.

3. All industry stakeholders to commit to addressing the environmental impact of their policies, products, and activities with concrete actions and clear timelines.

In support to implement the Resolution, AFRAA is engaging to mobilise resources to assist members through capacity building and knowledge sharing.

AFRAA Secretary General Intervention on SAATM at the ACI Africa 69th Regional Conference

AFRAA Secretary General, Mr. Abdérahmane Berthe during a session at the 69th ACI Africa Conference on 1st March 2023 in Kigali on theme: “Harnessing of SAATM Opportunities for the Industry – Airline Implementation Programme” intervened on ongoing industry actions on the Implementation of the Single African Air Transport Market (SAATM), headwinds being faced and recommendations to effective implementation of SAATM.

In his presentation, he elaborated the status updates on ongoing actions of the Air Transport Sustainability – SAATM Roadmap, the connectivity drivers as well as industry initiatives by various stakeholders on SAATM.

With regards to status of

direct flights and 5th freedom flights in Africa, Mr. Berthe reported that 85% of intra-African flights are directs while 15% connecting with one stop or more. Among those direct flights, 5th freedom represent only 21%, while the share of 3rd and 4th freedom flights is 79%.

From AFRAA data hub, it was reported that ASKY airlines, Ethiopian Airlines, and Kenya Airways were the African airlines operating the highest number of 5th freedom routes. He added that African airlines operate only 14% of their direct flights on 5th freedom while 86% on 3rd and 4th freedom. Non-African carriers operate a most important share of their direct flights in 5th freedom in Africa.

With regards to granting of 5th freedom traffic rights by African States, AFRAA reporting framework by its member airlines revealed that among 8 (eight) reporting airlines, some have mentioned traffic rights denial by 11 African states. On opportunities from SAATM, Mr. Berthe highlighted that SAATM is a crucial stepping-stone to make air travel a reality for African citizens; it will grow regional air transport which will to drive economic growth and transform lives.

Recommendations to effective implementation of SAATM Mr. Berthe made the following recommendations:

1. African States to be willing and ready to implement SAATM and to stop denial of 5th freedom traffic rights to African airlines.

2. Governments to stop over taxation of aviation.

3. Air transport stakeholders to collaborate to implement the roadmap of the air transport sustainability that was developed by the 2022 Laboratory.

4. Reduce costs along the air transport value chain.

5. Collaboration among airlines to improve connectivity and deliver a better service quality.

6. Right size fleet strategy to improve routes profitability and to connect secondary airports.

7. States, industry, airports to work together to implement the African Routes Development Strategy forum.

RwandAir hosts AFRAA for the CEO Dialogues Session

3 March 2023, Kigali – Rwanda: The African Airlines Association (AFRAA) Secretary General, Mr. Abdérahmane Berthé, met RwandAir Chief Executive Officer – Ms. Yvonne Manzi Makolo and RwandAir Leadership on 2 March 2023 at RwandAir Headoffice in Kigali, Rwanda for the “AFRAA Member Airline CEOs Leadership Dialogues”. This meeting marks the second edition of the AFRAA CEO Dialogues for 2023. The CEO Dialogues initiative is a drive-by AFRAA to create close engagement with member airlines and a space for dialogue necessary to develop transformative initiatives.

AFRAA and RwandAir had a unique opportunity to reflect and exchange ideas. Highlights of the Dialogues were RwandAir’s vision and strategy, the opportunities for value addition through AFRAA joint projects and initiatives for enhancement of revenues, AFRAA support through advocacy on various aspects impacting RwandAir’s operations such as blocked funds, high taxes and charges, and market access.

At the conclusion of the discussion, RwandAir expressed interest in hosting the 2024 Aviation Stakeholders Convention in Kigali. The Convention is one of Africa’s leading air transport industry events by AFRAA that brings together over 500 delegates from across the globe to foster dialogue for win-win business relationships, build sustainable networks and create a competitive environment to improve the aviation business support base in Africa.

Abdérahmane Berthé, AFRAA Secretary General stated:

“I am delighted for the opportunity to dialogue with RwandAir. The platform has facilitated sharing views on key areas that will be followed up in the AFRAA action plan. I look forward to continued collaboration between RwandAir and the Association, which is essential in fulfilling AFRAA’s mandate.”

Yvonne Makolo, RwandAir CEO, said: “It was an honour to meet Secretary General, Mr. Abdérahmane Berthé from the African Airlines Association and discuss our industry’s opportunities in the coming years.

“We are positioning RwandAir to be at the forefront of African aviation and look forward to supporting the growth and evolution of the African travel and tourism sector, which will help drive economic development throughout the continent.”

RwandAir has been a member of the Association since 2009 and is currently a member of the Executive Committee of AFRAA in their capacity of membership of the IATA Board of Governors (BOG) up to their term of office on the IATA BOG.

Kenya Airways meets AFRAA for CEO dialogues

8 March Nairobi – Kenya: Kenya Airways Chief Executive Officer – Allan Kilavuka hosted the African Airlines Association (AFRAA) Secretary General, Abdérahmane Berthé, at the Kenya Airways headquarters in Nairobi – Kenya on 7 March 2023 for this year’s 3rd edition of the “AFRAA Member Airline CEOs Leadership Dialogues” session. Both AFRAA and Kenya Airways Leadership teams were present at the dialogues session.

The meeting presented a unique opportunity to discuss in detail various subjects, including the state of the air transport industry and the underlying dynamics, updates on Kenya Airways’ restructuring process, the airline consolidation feasibility study for Africa roadmap, the status updates on the implementation of the air transport sustainability roadmap and advocacy actions on various issues impacting Kenya Airways’ operations.

Abdérahmane Berthé, AFRAA Secretary General, remarked: “It gives me great pleasure to exchange ideas with Kenya Airways and take stock of feedback for continuous improvement and realignment of AFRAA actions to meet the individual needs of our members better. This is one of the underlying strategies for AFRAA’s business perspective to facilitate continued collaboration with our members to fulfill AFRAA’s mandate.”

At the end of the CEO Dialogues session, AFRAA toured the Kenya Airways Fahari Innovation Hub, a centre for innovation that acts as a springboard for new ideas and data-driven innovations to accelerate impact-driven solutions that address some of the societal and business challenges. Launched in 2021, Fahari Innovation Hub is part of Kenya Airways’ strategy in contributing to the sustainable development of Africa by empowering, collaborating, and co-creating innovative ideas and strategies with local start-ups and the small-medium enterprises (SMEs) ecosystem.

Kenya Airways is the 1st Vice Chairman of the AFRAA Executive Committee, and the airline’s membership to AFRAA spans from 1977.

AFRAA Concludes its 54th Annual General Assembly with emphasis on concerted actions to drive Air Transport Industry Sustainability

December 14, Dakar, Republic of Senegal

The African Airlines Association (AFRAA) and Air Senegal concluded the 54th Annual General Assembly (AGA) in Dakar, Senegal. The event was held under the High Patronage of the Government of Senegal. The Assembly, which brought together 456 delegates from 42 countries under the theme “Acing the Roadmap to Sustainable African Aviation”, called upon African airlines and air transport stakeholders to act on initiatives and strategies that will drive the sustainability of the

air transport sector to realise its potential. Among others, these include: the Air Transport Sustainability Roadmap, the effective implementation of the Single African Air Transport Market (SAATM), the Continental Free Trade Agreement (AfCFTA), and the Free Movement Protocol.

In his welcome address, Mr. Alioune Badara Fall, President of AFRAA and CEO of Air Senegal stated: “I pay tribute to the extraordinary work by stakeholders in putting in place projects

and programmes to build together a more united future for a sustainable African aviation, for the full benefit of African economies and populations.” The ultimate goal, he noted, will realise the improvement of connectivity between African countries, build truly efficient carriers both operationally and financially, attain structurally competitive tariffs in order to offer African populations the ability to travel, meet and exchange much more easily through new routes, increased frequencies.

Mr. Abdérahmane Berthé, AFRAA Secretary General, noted with satisfaction and great interest the importance given to the development of the aviation sector by the State of Senegal through investments in aeronautical development infrastructure and the National Company Air Senegal. “In memory of the particularly difficult times during this ongoing phase to restore air transport activity, I would like once again to express AFRAA’s solidarity with the entire chain of players in the aeronautical industry. As the aviation community, we must continue the ongoing joint efforts to support recovery and foster a sustainable and resilient air transport system in Africa.” he stated.

Resolution on aviation net zero carbon emissions by 2050

Among the resolutions, in line with the industry commitment towards achieving net zero emissions by 2050, the Assembly urged all industry stakeholders to commit to addressing the environmental impact of their policies, products, and activities with concrete actions and clear timelines. The Assembly further encouraged all AFRAA member airlines to continue improving their operations’ efficiency to achieve sustained in-sector emissions reductions and to support the transition to reliable, cost-competitive Sustainable Aviation Fuels (SAF).

Appointment of officers

The 54th AFRAA AGA elected LAM Mozambique as the Chairman of the Executive Committee while Kenya Airways was elected as first Vice Chairman and Air Algérie was elected as second Vice Chairman. The AFRAA Executive Committee has oversight responsibility for the Association.

Host of the 55th AGA

The 54th AFRAA AGA elected Uganda Airlines as the President of the association. Uganda Airlines will host the 55th AGA in Uganda from 19-21 November 2023.

Launch of the 1st edition of the History of Aviation report. AFRAA launched the 1st edition of the History of African Aviation Report at the side-lines of the 54th AFRAA Annual General Assembly (AGA) & Summit on 12 December 2022 in Dakar – Senegal. The History of Aviation Report by AFRAA is a prestigious industry publication, a first of its kind in Africa, which contains a rich mix of information to enrich the understanding of the development of African aviation.

Highlights from the Secretary General’s State of the Industry report

The recovery of aviation activity continued in 2022. After a contraction in 2020, Africa’s GDP rebounded by 6.9% in 2021. The prospects for economic growth in Africa are highly uncertain. The effects of the Russian-Ukrainian conflict could lead to a larger decline in global production than currently expected.

Compared to February 2020, African airlines have reopened almost all international routes. Some have extended their network to new destinations, particularly in West and North Africa. From January to November 2022, offered capacity reached 75.4% for the same period in 2019, while traffic reached 74.7%. The recovery of the level of activity in 2019 is still in progress.

AFRAA priorities for 2023:

Implement the roadmap actions for the sustainability of air transport in Africa.

Continue to roll out the AFRAA Five-Year Strategic Plan.

“Our industry must build its resilience and sustainability in the face of future crises like COVID-19 and stop the progressive marginalisation we have suffered over the past 40 years.”

Mr. Berthé emphasised.

AFRAA retreat

AFRAA Secretariat held a 3-day teambuilding and retreat at the Windsor Hotel in Nairobi – Kenya with the overall goal to drive business performance of the Association. On one hand, the retreat enabled the Secretariat to review and rethink the strategies to enhance the efficiency of the Association in creating value and delivering our mandate.

While on the other hand, the team building provided an opportunity to strengthen the relationships within the corporate team and maximise team efficiency.

To enrich the brainstorming sessions during the retreat to optimise the output of the Association, AFRAA Secretariat was joined by Mr. Allan Kilavuka – CEO Kenya Airways & 1st Vice Chairman of the Association, Mr. Sanjeev Gadhia – CEO Astral Aviation and Mr. Alex Avedi –CEO Safarilink.

Training Conducted in 2022

1. Instructional Techniques Course

AFRAA conducted a Physical Instructional Techniques Course on 13th – 17th March 2023 for Rwandair where 14 participants attended the training. Through this course the participants were able to define and implement the basic rules of good Instructional Techniques, demonstrate how to effectively prepare for start, conduct and wrap-up a training event, apply basic principles of learning and active training and demonstrate appropriate instructional techniques.

Upcoming courses

The schedule courses for 2023 are as follows:

2. Instructional Design Course

AFRAA conducted a Physical Instructional Design Course on 20th – 24th March 2023 for Rwandair where 14 participants attended the training. By the end of the course, the participants were able to apply the basic steps of the Instructional Design Process to an instructional problem and develop a plan for an instructional design.

AFRAA data

African airlines’ performance updates by AFRAA –March 2023

Airline performance: In March, the traffic carried by African airlines reached 94.8% of 2019 level. Domestic market share was at 37%, intra-Africa at 31% and intercontinental at 32%.

AFRAA estimates that by end 2023, total passengers carried by African airlines will reach 85 million, this being about 10 million short of the full year 2019 passenger traffic.

The total number of intercontinental routes operated by African airlines exceeded pre-COVID levels since October 2022. In 8 African airports (Johannesburg, Nairobi, Addis Ababa, Lusaka, Cairo, Casablanca, Abidjan and Lome) intra-Africa connectivity reached or exceeded pre-COVID level since December 2022.

The year 2023 is witnessing a narrowing of airline revenue gap compared to 2022. In the first 3 months of the year, African airlines missed the levels attained in a similar period in 2019 by US$0.3 billion. This is expected to further narrow in the second quarter to US$0.2 billion according to AFRAA. Though the full year estimated revenue gap is yet to be computed, it appears 2023 will be a better year compared to the prior year. The 2022 full year revenue loss was US$3.5 billion for all African airlines combined.

Jet A1 price continued the downward trend in March with the global average price per barrel in the last week of March reaching US$102.5. However, this trend changed to a surge in April following the OPEC producers’ announcement of plans to cut crude output.

Blocked funds: Nigeria, with US$743 million of airline-blocked funds, is currently ranked the second highest in the world after Venezuela. An AFRAA survey indicates that 3 African airlines alone, have about US$44.2 million blocked in Nigeria. These 3 AFRAA airlines have a total of US$88.9 million blocked in 12 African countries at the end of 2022. Aside Nigeria, other African countries with blocked funds at the end of 2022 include Algeria, Libya, Cameroon, The Central African Republic, Ethiopia, Eritrea, Equatorial Guinea, Guinea Conakry, Burundi, Malawi, Sierra Leone, Zambia and Zimbabwe.

AFRAA is continuing its advocacy on blocked funds. According to the Secretary General of AFRAA, Abdérahmane Berthé, “It is unacceptable for some States to hold on to airline generated revenues that is badly needed to cover operating costs and yet expect operations to continue undisrupted. The longer these funds are held, the bigger the financial burden these States impose on airlines supporting air connectivity and economic activities in these countries.”

Regulatory and Industry Developments

Canada – Single-use Plastics (SUP) Prohibition Regulations: The Canadian government published a regulation on single-use plastics (SUP) prohibitions in June 2022, which has implications for airline operators. Starting 20 December 2022, airlines are unable to buy or import 6 categories of SUP, including cutlery, foodservice ware, sticks and straws, etc. in Canada. See link for details: technical guidance.

Consultation on balanced approach Schiphol: The Dutch Ministry for Infrastructure and Water Management launched a consultation on the noise-balanced approach, in which they propose a combination of required noise restriction measures to reduce the 500k movement cap to attain the 440k movements cap, imposed by the government. However, on 5 April 2023 the Dutch Court halted the implementation of the proposed flight cuts after IATA pointed out that the reduction was in contravention of EU Laws. Details are available here English Sierra Leone Airport Development Charge: Sierra Leone has made revisions to Aviation Security Charge and Foreign Travel Tax, including a revocation of Foreign Travel Tax for ECOWAS States. The government, through the civil aviation authority, plans to increase by 1400% Airport Development Charge to be borne by passengers. “This is a shot in the foot for a country that needs air connectivity to facilitate trade, business and general socio-economic development”, says AFRAA Secretary General, Abdérahmane Berthé.

African Airlines performance updates, AFRAA March 2023

Million

AFRAA estimates that by end 2023, total passengers carried by African airlines will reach 85 million.

In January 2023, Domestic traffic represented 37% of the passengers carried, Intra-African passengers carried represented 31%, Intercontinental traffic was 32%.

SAATM IMPLEMENTATION

10 African States are reported to have denied 5th freedom traffic rights to African airlines.

Jet A1 price continued the downward trend in March with the global average price per barrel in the last week of March reaching US$102.5. However, this trend changed to a surge in April following the OPEC producers’ announcement of plans to cut crude output.

Nigeria, with $743 million of airlineblocked funds, is currently ranked the second highest in the world after Venezuela. An AFRAA survey indicates that 3 African airlines alone, have about $44.2 million blocked in Nigeria.

Since Dec 2022, IntraAfrica connectivity reached or exceeded pre-Covid level in these 8 African airports Johannesburg, Nairobi, Addis Ababa, Lusaka, Cairo, Casablanca, Abidjan and Lome.

Capacity and traffic evolution

African airlines PAX carried

African airlines’ RPKs evolution Seats

• 67 million PAX carried in 2022.

• Traffic is expected to reach 92.3% of the 2019 levels in February 2023.

• In December 2022 (final adjusted data):

√ Domestic traffic represented 37% of the passengers carried.

√ Intra-African passengers carried represented 31%

√ Intercontinental traffic was 32%.

International routes

The percentage of international routes operated by African airlines exceeded the pre-COVID level since October 2022.

The numbers are in an ascending trend since the COVID-19 disruption. We can observe a seasonality, with the number of routes increasing from May to October, and in December which include peak seasons.

Intra-African connectivity

Number of Intra-African connections at major hubs per African sub-regions

Eastern Africa

Northern Africa

Southern Africa

Central and Western Africa

The global IntraAfrican connectivity is estimated to have reached the preCOVID level since December 2022.

The global Intra-African connectivity is estimated to have reached the preCovi d leve l sin c e December 2022

However, the number of existing connections is far lowe r th a n th e re a l potential.

However, the number of existing connections is far lower than the real potential.

Passenger revenue loss for African airlines

Passenger revenue loss attributed to COVID-19 (compared to 2019)

Quartley Revenue Loss

• Estimated Revenue loss for 2022 USD 3.5 billion, representing 20% of 2019 revenues.

• Estimated Revenue loss for Q3 2023: USD 0.3 billion

Year 2023 estimations are not yet available.