A meeting of the world’s largest grouping of commercial airline and freight executives in Cape Town is proving a unique opportunity for African aviation.
The International Air Transport Association (IATA), represents some 240 airlines comprising 84% of global air traffic, opened its 69th Annual General Meeting (AGM) and World Air Transport Summit in Cape Town, South Africa, today.
The meeting kicked-off with strong calls for African governments to take full advantage of aviation as a catalyst for growth and development.
With the global financial crises at the uppermost of everyone’s mind, Tony Tyler, IATA’s Director General and CEO, noted that Africa held the greatest potential for aviation and that aviation is well placed to contribute to the development of Africa.
“Economic reforms and political stability have spurred growth and development. South Africa is the newest member of the BRICS grouping of states,” Tyler said.
This concept was echoed by Kgalema Motlanthe, Deputy President of South Africa, who said in his opening address that the aviation industry is an important contributor to socio-economic inter-connectivity and trade in an increasingly globalised world.
“As a result, improvement of Africa’s aviation is amongst one of the most important drivers of Africa’s development through trade between Africa and the rest of the world, driven in the main by the trade in agricultural and perishable goods,” Motlanthe said.
“Consequently,” he continued, “it is hard to imagine that we can transform Africa’s structural growth without a concomitant improvement in Africa’s aviation industry.
“Global connectivity – enabled by aviation – has a very powerful role to play both in integrating the 54 national economies of Africa and in connecting them to the world,” Tyler explained. “But this will require the commitment of governments to solve some major issues.”
This was repeated by Motlanthe, who said that the growth potential of Africa’s aviation industry cannot be realised if African governments do not improve collaboration with the aviation industry.
“African states must play their part in improving aviation policy by providing the necessary public infrastructure and support programmes associated with cushioning the high initial capital investment necessary for assisting the industry to grow,” Motlanthe continued.
But there are issues that prevent Africa from reaching its full potential. “It is also a continent with serious issues,” is how Tyler described it, with safety being the biggest challenge facing African aviation.
“IATA’s 20 sub-Saharan members are performing in line with the global average on safety as are the 24 sub-Saharan airlines that have met the 900+ standards of the IATA Operational Safety Audit (IOSA). But if we look at the entire African industry, safety remains a challenge with an overall accident rate many times the global average. This AGM is an opportunity to send a clear signal to the region’s governments that world class safety is possible in Africa and that we support their commitment to achieving it by 2015,” said Tyler.
Whilst safety is the biggest topic of concern, other key issues include the price of fuel (some 21% more expensive than the global average), taxation and liberalisation of government policies.
As important as Africa is, there are other issues that affect the global airline industry requiring the attention of the IATA AGM attendees.
Chief amongst these is the development of a new distribution capability (NDC). The existing global distribution system that airlines use to send their offers to travel agents is proving outdated, having been developed in the era before the internet and email. The basics of fare, class and availability is being outclassed by the options available on an airline’s website.
The NDC proposal is based on open XML standards, offering the agent better quality of information. The NDC appears to have picked up some opposition from various sectors within the travel industry who fear that the new system will compete with their services.
Establishing appropriate regulation is another important matter under discussion. Chief amongst these is the matter of passenger rights. Some 50 countries have passenger rights requirements affecting air transport and several more are considering imposing them.
“Most passenger rights regulations are centred on levying penalties or preventing activities rather than providing solutions,” says Tyler.
The morning’s session unanimously endorsed a set of principles for governments to consider when adopting consumer protection regulations.
Similarly, the environment is receiving attention. IATA recognises that reducing carbon emissions is a global challenge. A resolution will be discussed on how to share the burden of carbon-neutral growth.
With many different models being investigated for the industry to share in the emissions bill, the AGM will have to decide how that bill is to be paid. The global airline industry received a huge shock and a taste of this to come with the now aborted European Emissions Trading Scheme.
“If we don’t agree,” Tyler says, “governments will decide on our behalf.”
The AGM is to conclude on 4 June 2013.