Airlines call for government to engage

HARMONISATION of
governmental trade,
immigration and
taxation policies with air
transport connectivity
will stimulate growth and
promote competition in SA
and other member states of
the SADC.
Speaking at the 44th
annual general assembly
of the Airlines Association
of Southern Africa (Aasa)
in Mauritius on October
31, ceo Chris Zweigenthal,
proposed the establishment
of a forum in which regional
governments and airline
industry players could
constructively engage and
close the ‘gaps’ that exist
between government policies
and commercial air transport
industry strategies.
Chris suggested the
forums be held six-monthly
or annually, to allow
governments to notify airlines
of proposed new policies and
reciprocally enable industry
to work with governments by
alerting them to any conflicts,
problems or threats these
new policies might pose to
the industry. That way, they
could resolve to find the best
workable approaches. A good
example of how this would
work is the encouraging
engagement between SA
Department of Home Affairs
on the implementation of the
new immigration regulations
in South Africa, he said.
“The confusion and mixed
signals transmitted by
governments compound the
many other challenges the
industry faces, including
high costs of jet fuel,
infrastructure, safety,
security and environmental
costs; constraints on
ownership; control and
market access – all of which
impact the region’s airlines’
sustainability and growth,”
he said. This blunts the
region’s ability to stimulate
trade, tourism and economic
growth, both nationally and
regionally.
Chris went on to describe
how some airlines (for
example, those in the UAE,
Kenya and Ethiopia), are
experiencing unprecedented
growth and profitability
as a result of their
governments’ clear and
aligned economic growth
strategies and policies.
“If we are serious about
growing our economies, then
governments and the airline
industry must constructively
engage to ensure that
existing and future
policies are conceived and
implemented so that they do
not have unintended negative
consequences.”
Chris noted that airline
margins in the region are
paper-thin but he predicted
an upturn. “The tide appears
to have turned and we
cautiously expect growth of
between 2% and 4% over the
next four years, tempered
by South Africa’s sluggish
annual GDP expansion of
less than 2% for at least
the next year. Elsewhere in
Southern Africa, growth is
between 4% and 6%, but
certain markets have the
potential to touch doubledigit
annual GDP growth.
We could be doing even
better if the regulatory and
policy environment was more
conducive to growth and let
airlines focus on doing the
business instead of being
almost permanently fixated
on survival.”