AFRICAN airlines are
expected to report a profit
of US$100m (R1,07bn)
by the end of 2014, up from
a loss of $100m last year,
according to Iata’s latest
financial forecast.
The association says the
key factors driving the better
performance of African
airlines include the improving
economic performance in the
region, which makes it easier
for airlines to generate cash in
a high-cost environment, and
improvements in efficiency in
airline operations.
Tony Tyler, Iata dg and ceo,
however, added that challenges
still facing the region included
poor infrastructure, high
taxes and restricted market
access policies for intra-African
connectivity. “This is on top of
the intensifying competition
that the region’s airlines face
on long-haul routes,” he said.
While he said there was
overall growth in passenger
numbers, this was now being
led by the developed rather
than emerging markets. He
added that the tightening of
South Africa’s monetary policy
to protect exchange rates was
slowing economic growth.
Globally, Iata’s outlook for
the year was reduced from
a previously projected nett
profit of $19,7bn (R210,7bn)
to $18,7bn (R200bn),
accounting for a fuel bill that
was $3bn (R32bn) higher than
was predicted in December
last year. Tony said the
total number of passengers
expected to travel by air this
year was 3,3bn, which equates
to 6 000 people boarding
a flight every minute. “Even
though this is a forecast
downgrade, the overall story
for the industry is positive.”
Some of the other challenges
facing the airline industry
are the rising price of oil as
a result of the instability in
the Ukraine and the need to
align regulations surrounding
passenger rights on a global scale.
