LUANDA, Angola, August 2019 – The African Airlines Association, also known as the Association of African Airline Companies and by its abbreviation AFRAA Secretary General Abdérahmane Berthé met TAAG Angola Airlines Chief Executive Officer (CEO), Rui Carreira, at TAAG Angola Airlines – state-owned national airline of Angola head-office during his visit to Angola on Monday (26 August 2019).
The meeting assessed the state of development of air transport in the country and the needs of African airlines towards a safe, efficient, sustainable and profitable airline business. Also present at the meeting was TAAG Angola management team who discussed the performance of the airline and areas where AFRAA can provide support.
The meeting noted the importance of collaboration for the development of African aviation. Commercial partnerships are vital to help African airlines overcome some of the unique challenges experienced in their operating environment. Mr. Berthé highlighted other forms of collaboration and resource sharing among airlines which AFRAA is addressing through its joint projects on fuel purchase, distribution, training, route network coordination, maintenance and pooling of resources. Through these projects, AFRAA seeks several avenues to address pertinent challenges and identify common solutions to pave way for a stronger Association for its members.
AFRAA will further support its members through the AFRAA Consultancy Unit which will be launched by the end of 2019. The main objectives of the Consultancy Unit will be to provide utility-oriented studies to airlines and stakeholders, undertake methodological macro-econometric modelling and forecasting of the aviation industry and provide value added client-centered products and services.
AFRAA Secretary General highlighted that the Association will vigorously implement its Action Plan that will transform the industry as well as help fuel positive economic progress across the African continent.
The developments on the implementation of the Single African Aviation Market (SAATM) were discussed. AFRAA noted with appreciation TAAG Angola’s support of SAATM, the Airline business cannot grow and thrive without market access which is one of the critical factors for airlines business to succeed. An interconnected Africa will boost intra-African connectivity, trade and tourism, creating economies of scale that will benefit the industry and allow African carriers to dominate African skies. AFRAA, as a member of the Monitoring Body of the Yamoussoukro Decision (YD) will be at the forefront of SAATM implementation and will facilitate the incorporation of the views and concerns of its members for the successful implementation of this important flagship Project of the AUC.
The meeting discussed other challenges being faced by African airlines such as high taxes and charges, high fuel costs and blocked funds. On fuel costs which account for 30-40% of airlines’ operating costs in Africa, it was noted that in various instances in Africa there is opacity on fuel pricing. In some instances, some countries levy taxes on fuel which is contrary to the Chicago Convention.
With regards to taxes and charges, Mr. Berthé stressed the effect of excessive taxes, charges, surcharges and fees on the sustainability of African airlines. High taxes and charges make African airlines less competitive since these levies have significant impact on the financial performance of airlines operating in a high cost environment. He highlighted AFRAA’s actions on the improvement of the current international policy and regulatory framework specific to charges. He added that ICAO principles regarding user charges (contained in the ICAO’s Policies on Charges for Airports and Air Navigation Services) and the foundation set in the Chicago Convention should be applied by relevant authorities.
On the situation of airlines’ blocked funds in Angola, it was noted that the country had cleared the backlog of blocked funds which had been significant and had negatively impacted the affected airlines’ operations. The situation of Blocked funds in Angola had been aggravated by low commodity prices, fiscal policies and currency fluctuations in the country.
To assist TAAG Angola on its growth and future plans, AFRAA offered to provide training and capacity building in managerial and technical fields. TAAG Angola has been an active member of AFRAA since 1978.