African airlines must consolidate for the continent to improve its aviation prospects, Kenya Airways CEO Allan Kilavuka has said.
Speaking at the Connecting Africa show on CNN, Kilavuka said that the airline sector stands a huge chance of benefiting from the African Continental Free Trade Agreement.
“The African aviation market is very fragmented. I mean, 55 countries, we have so many airlines on the continent. Most of them are not viable, that truth be told. The solution to that is to consolidate,” he noted.
He said consolidation will bigger and entities more economical entities from a scale perspective and can respond to high costs.
According to Kilavuka, AfCFTA could play a major role in boosting passenger and freight traffic on the continent.
“There’s not enough traffic moving from South to North and North to South, and not enough goods being traded between Sub-Saharan Africa and North Africa,” said Kilavuka.
He noted that this is about to change because of the African Continental Free Trade Area, which will give access to goods and also allow for greater freedom of movement for people from both sides.
The United Nations Economic Commission for Africa (UNECA) says the initial implementation of AfCFTA increased trade between countries in the region by 20 percent in 2022.
In many parts of Africa, the aviation sector is still in its infancy, with poor infrastructure and a fragmented network of routes.
Although Kilavuka and other aviation leaders are pushing for the liberalisation of the market in Africa, he said that this could be done in stages to help with the enormity of the task.
“What we have said is, even when it comes to the liberalisation of the aviation, we could start with pockets, East Africa, Southern Africa, West Africa, and see how that works. So, if you implement it in pockets and then roll it out, that makes much more sense,” added Kilavuka.
Using the Single African Air Transport Market (SAATM), the continent is aiming to increase economic integration, promote social integration, and boost intra-African trade and tourism.
SAATM was launched in 2018, but so far only 35 of the 55 African countries have signed up.
