STRATEGY

Use passenger flights for cargo, EAC states told

The cost of air freight in East Africa has escalated.

In Summary

•To reduce operating costs, the EAC partner states should waive landing fees, excise duty on aviation fuel, navigation, landing, parking and COVID-19 related fees, the East African Business Council has said.

•EAC partner states should also provide subsidies for the aviation industry in the form of direct financial support, loan guarantees, corporate bonds and tax reliefs.

A KQ plane loading fresh produce for export/
A KQ plane loading fresh produce for export/
Image: FILE

The East African Community (EAC) member states have been urged to facilitate the use of passenger aircraft for cargo-only operations, including the repositioning of air cargo flight crews.

This will ensure a continued flow of exports at competitive prices, the East African Business Council (EABC) has said while enabling regional carriers to remain in business.

EABC said while the rest of the world has adopted new measures to facilitate air transport, the EAC partner state airlines are still in the process of adapting and many of their aircraft remain under-utilised.

The cost of air freight, particularly in East Africa has escalated drastically, making the region’s export produce uncompetitive.

Airfreight charges to the European Union and other markets in the last few weeks have ranged from $3-7 per kg up from an average of $1.50-2.50 per kg.

“The high air freight charges can be attributed to a combination of factors. These include higher operating costs, fewer scheduled or chartered flights, and supply and demand imbalance,” EABC chief executive Peter Mathuki said in a statement.

In Kenya, for example, the volume of fresh produce out of Jomo Kenyatta International Airport (JKIA) has reduced from a weekly 5,000 tonnes to 1,300, a 75 per cent decline with similar trends reported across the region.

Costs, however, continue to ease with more scheduled capacity provided by KLM, Qatar and Ethiopian Airlines.

“The return of Rwandair and Kenya Airways to the skies is a welcome relief for exporters. However, it will soon become increasingly difficult for them to compete with airlines that are receiving government subsidies,” Mathuki said.

The council has called on the regional governments to promote consolidation of airfreight and cooperation between EAC airlines and allow for flexibility in scheduling.

To reduce operating costs, the EAC partner states should waive landing fees, excise duty on aviation fuel, navigation, landing, parking and COVID-19 related fees, the council notes.

To encourage imports by air, the regional states should waive all import duties and VAT by air during the COVID crisis.

EAC partner states should also provide subsidies for the aviation industry in the form of direct financial support, loan guarantees, corporate bonds and tax reliefs, EABC has advised.

Long-term decisions should also be made to ensure an increase in inter-regional air transport frequencies by at least 41 per cent and reduce flight time.

The current COVID-19 crisis on air cargo operations requires extraordinary measures to address the challenges in the region, EABC says.

“Like the EU, it demands greater cooperation between East African airlines and the international aviation community, including air cargo and express service providers to ensure the supply and fair distribution of scarce and essential goods,” said Mathuki.