African airlines are expected to lose nearly $8.1 billion this year due to the Covid-19 health crisis, the Association of African Airlines (AFRAA) warned, calling for urgent government support to avoid a cascade of bankruptcies.
The figures put forward by AFRAA, which comprises 45 African airlines, are even more alarming than the International Air Transport Association (IATA)’s April forecast of an annual loss of $6 billion.
AFRAA’s impact analysis shows an annual reduction in passenger traffic of 90.3 percent for the month of May, with recovery expected to begin from the third quarter of 2020 with domestic operations, followed by regional and intercontinental flights.
On the cargo segment, the Association also noted a shortage of cargo capacity in Africa due to the need to transport medical equipment and essential goods.
According to AFRAA, the liquidity crisis is becoming a serious concern that could lead to numerous bankruptcies in the coming months.
AFRAA Secretary General Abderahmane Berthé has urged African governments to consider a rescue and recovery plan that compensates for significant losses, reduces the burden of ongoing operating costs and subsidizes the survival and recovery of the industry.
In early May, several international and African aviation organizations had issued an urgent appeal to support the air transport and tourism sectors in Africa.
Without emergency funding, the Covid-19 crisis will lead to the collapse of Africa’s air transport and tourism sector, which contributes US$169 billion to the African economy, representing 7.1 percent of the continent’s GDP, the collective comprising IATA, the United Nations World Tourism Organization (UNWTO), the World Travel and Tourism Council (WTTC), AFRAA and the Southern African Airlines Association (SAAA) had stressed.
They thus sought the support of international financial institutions, national development partners and international donors to assist the travel and tourism sector in Africa, which employs some 24.6 million people on the African continent.
HA/lb/abj/APA