African airlines urged to merge to survive

NAIROBI – African airlines must consolidate and increase efficiency to cope with losses due to high fuel prices and increased competition, the head of the international airlines association IATA said.

“The African aviation industry is not different from (the) aviation industry in the rest of the world. (It) is going through a very difficult moment,” said Giovanni Bisignani, chief executive of the International Air Transport Association (IATA).State-owned South African Airways is the continent’s biggest carrier.Other airlines serving the region include Kenya Airways, Air Mauritius and Ethiopian Airlines.European carriers British Airways and Air France also have a big presence, usually linking their former colonies with Europe.IATA has forecast airline losses in 2005 of US$7,4 billion as soaring fuel costs outstrip measures by airlines to cut costs.”We have to increase efficiency, bring down the cost and try to build consolidation in the industry,” Bisignani told reporters late on Monday in the Kenyan capital Nairobi.Bisignani said most of the losses will be recorded in the US while Europe and Asia will show some small profit.He said Africa, where IATA represents 39 airlines most of them in sub-Sahara Africa, will show a small loss.IATA was working with its members in Africa to increase efficiency in their system and was negotiating with airports to lower their user charges, Bisignani, a former Alitalia CEO said.A key measure is helping airlines in Africa to switch from paper tickets to electronic ticketing ahead of the association’s targeted deadline of 2007.So far Africa has achieved 36 per cent usage of electronic ticketing.But the figure is misleading because only airlines in South Africa, Kenya and Zimbabwe have made progress.”The other parts of Africa, we have to really work closely together with our members in order to achieve a level of penetration that will be more satisfactory,” he said.Experts say Africa’s challenge is to improve the image of its aviation industry.Bisignani said IATA was working with its members in Africa and other aviation organisations to rectify the problem through safety training and auditing.Safety concerns have led some countries to ban suspect airlines from landing at their airports, with some African airlines included on the list.But Bisignani said IATA was not convinced by the process for blacklisting airlines from landing in some European countries.He said the system needed to be transparent with a harmonised international set of standards.France and Belgium have announced their blacklists, including a number of African airlines.”I think the blacklist, like, how it is conceived now, it is not very efficient,” Bisignani said.”It is difficult to evaluate the performance of an airline by just checking one aircraft on the spot …in an hour.”He said the future of African airlines was bright despite the current difficulties with booming tourism expected to drive the continent’s aviation industry growth.But he said only airlines which are best managed will reap the benefits.He cited Kenya Airways as an example of an airline that could provide leadership to others in Africa.The Kenyan carrier this year posted the highest profit in its 28-year history of 3,8 billion shillings, up from 1,3 billion due to cost-cutting and a rise in passengers.”It is important that certain countries which have achieved good success can help other airlines around the continent in order to upgrade their system because we want to see an industry in Africa to be profitable and to develop at the same rate as we have experienced in other parts of the world,” he said.-Nampa-Reuters(It) is going through a very difficult moment,” said Giovanni Bisignani, chief executive of the International Air Transport Association (IATA).State-owned South African Airways is the continent’s biggest carrier.Other airlines serving the region include Kenya Airways, Air Mauritius and Ethiopian Airlines.European carriers British Airways and Air France also have a big presence, usually linking their former colonies with Europe.IATA has forecast airline losses in 2005 of US$7,4 billion as soaring fuel costs outstrip measures by airlines to cut costs.”We have to increase efficiency, bring down the cost and try to build consolidation in the industry,” Bisignani told reporters late on Monday in the Kenyan capital Nairobi.Bisignani said most of the losses will be recorded in the US while Europe and Asia will show some small profit.He said Africa, where IATA represents 39 airlines most of them in sub-Sahara Africa, will show a small loss.IATA was working with its members in Africa to increase efficiency in their system and was negotiating with airports to lower their user charges, Bisignani, a former Alitalia CEO said.A key measure is helping airlines in Africa to switch from paper tickets to electronic ticketing ahead of the association’s targeted deadline of 2007.So far Africa has achieved 36 per cent usage of electronic ticketing.But the figure is misleading because only airlines in South Africa, Kenya and Zimbabwe have made progress.”The other parts of Africa, we have to really work closely together with our members in order to achieve a level of penetration that will be more satisfactory,” he said.Experts say Africa’s challenge is to improve the image of its aviation industry.Bisignani said IATA was working with its members in Africa and other aviation organisations to rectify the problem through safety training and auditing.Safety concerns have led some countries to ban suspect airlines from landing at their airports, with some African airlines included on the list.But Bisignani said IATA was not convinced by the process for blacklisting airlines from landing in some European countries.He said the system needed to be transparent with a harmonised international set of standards.France and Belgium have announced their blacklists, including a number of African airlines.”I think the blacklist, like, how it is conceived now, it is not very efficient,” Bisignani said.”It is difficult to evaluate the performance of an airline by just checking one aircraft on the spot …in an hour.”He said the future of African airlines was bright despite the current difficulties with booming tourism expected to drive the continent’s aviation industry growth.But he said only airlines which are best managed will reap the benefits.He cited Kenya Airways as an example of an airline that could provide leadership to others in Africa.The Kenyan carrier this year posted the highest profit in its 28-year history of 3,8 billion shillings, up from 1,3 billion due to cost-cutting and a rise in passengers.”It is important that certain countries which have achieved good success can help other airlines around the continent in order to upgrade their system because we want to see an industry in Africa to be profitable and to develop at the same rate as we have experienced in other parts of the world,” he said.-Nampa-Reuters