ADDRESS BY THE MINISTER OF TRANSPORT, DR BLADE NZIMANDE AT THE AIRLINES ASSOCIATION OF SOUTHERN AFRICA (AASA) 48 TH ANNUAL GENERAL ASSEMBLY HELD IN LIINGSTONE - ZAMBIA 11-14 OCTOBER 2018 Programme Director: Mr Vusi Thembekwayo The Permanent Secretary of Transport & Communications : Mr Meshack Lungu Advocate Mandi Samson, Chairperson of AASA, Mr Chris Zweigenthal, CEO of AASA, Senior Officials of Government Board of Directors from various airlines, organizations and institutions CEO’s of Airlines herein present, Executives & Senior Officials of various organizations including IATA & the African Civil Aviation Commission Distinguished speakers, guests Ladies and gentlemen The South African Minister of Transport, Dr Bonginkosi "Blade" Nzimande would have loved to have been part of this assembly, but due to other pressing engagements that were pencilled into his diary a while back, he could not join us today. However, He has requested that we extend his sincere apologies, and also share some of his thoughts at this crucial gathering in the aviation calendar. 1
The Minister requested that I start by relaying his gratitude for the invitation to be part of this important occasion. He also wishes to commend AASA, its Member Airlines & Associate Members for consistently putting an effort into convening and making time to share thought-provoking viewpoints that leads to improvements in this sector. Programme Director Air Transport plays a key role in economic development and in supporting long- term economic growth. It also facilitates country's integration into the global economy, providing direct benefits for users and wider economic benefits through its positive impact on productivity and economic performance. The African Union (AU) Agenda 2063, identifies aviation, in particular, air transport as critical to the realisation of the Agenda 2063 flagship projects. The Agenda prescribes that by 2063, the necessary infrastructure to support Africa’s accelerated integration and growth, technological transformation, trade and development should be in place. In addition interconnectivity between island States and mainland States would be achieved through the implementation of Yamoussoukro Decision (YD). 2
Again, as envisaged in the Abuja Treaty, regional integration as a strategy for achieving sustainable economic growth remains the way forward in achieving an African Economic Community. The Air transport market access has a significant catalytic role as an engine for Inter and Intra regional integration through enabling increased accessibility between economic hubs, reduction of travel time and cost and providing connectivity amongst several city pairs and countries. The contributions that aviation and tourism sectors make to the economy are important for the African governments to improve the living standards in the continent. The fact that almost a third of African countries (16 out of 54) are landlocked and that alternative modes of transport are under-developed make air transport all the more important. While these conditions are seemingly favourable, decades of economic stagnation and low per-capita incomes in many African countries have made commercial aviation in Africa the least developed in the world. African’s share of the global aviation market stands between 1-5% but the African aviation industry during the recent period of world economic crisis, enjoyed a significant growth rate (5%-7%) compared to other regions of the world. 3
Most significant is the volume of intra-African traffic which stood at roughly 30% of the total African air transport traffic. This trend is projected to remain in the years to come. Part of the reason for Africa’s under-served status, according to a published World Bank study, on Open Skies for Africa – Implementing the YD, is that many African countries restrict their air services markets to protect the share held by state-owned air carriers. The slow implementation of YD has caused the continent to miss out on substantial economic benefits, although some air markets between Africa and countries outside of Africa have been liberalised to a significant extent. But most intra-African aviation markets remain closed and regulated through bilateral agreements which limit the growth and development of air services. Within Southern African Development Community (SADC), progress has been made in liberalizing certain elements of the Bilateral Air Services Agreements. However, Some States still maintain the seat regimes, single, dual and triple designation of operators on specific routes, limited capacity and restrictive commercial arrangements between operators. As African states we have various forms of agreements on how to cooperate on various matters. 4
Ladies and gentlemen South Africa has already started to implement the key principles of the Yamoussoukro Decision with ready and willing States pending the continental implementation of the multilateral framework. To date, South Africa has deregulated air services with thirty-six (36) African States and has further advised Benin, Cape Verde, Congo, Ivory Coast, Egypt, Ethiopia, Kenya, Nigeria, Rwanda, Zimbabwe, Ghana and Sierra Leone that the air transport market amongst these States are liberalised as per provisions of the Yamoussoukro Decision and in support of the establishment of a Single African Air Transport. The African Civil Aviation Commission (AFCAC) is working on assisting States in this regard, especially on compliance matters and standardisation. You may know that the member States of AFCAC or regional formations do meet from time to time to exchange ideas and iron out differences but our view is that more still needs to be done. Instead of continuing to struggle in isolation, operators should work with their own Civil Aviation Authorities to ensure that doors are opened for them in countries that they operate in, or would like to operate in. Likewise, Regulators must shape themselves up to be credible, strong and ensure that the environment is conducive for airlines to operate. With the launch of the Single African Air Transport Market (SAATM) by the African Union (AU) in January this year, twenty-three African states, including South Africa, participated in the bid to open up the continent’s skies. 5
However, it is important that African airlines position themselves to take advantage of this window of opportunity. If operators in Africa do not take advantage of open skies, airlines from other parts of the world will overtake those in Africa. The time is now to make in roads so that inter- connectivity hurdles within the African Continent are addressed. As we seek ways to implement the YD solemn declaration, a safe, secure and efficient aviation industry is vital for ensuring a sustainable aviation industry in Africa. Therefore, safety and security concerns in Africa cannot be overridden by the desire to have enhanced market access as provided for in YD. The challenge here is in maintaining adequate safety and security oversight through our regulator bodies. In the South African context, the South Africa Civil Aviation Authority is the responsible authority. We should look at greater partnership through the “ No Country Left Behind ” initiative, e.g. where public and private airlines cooperate and service our local markets and routes. Therefore, Africa needs to exert a lot of efforts to scrap non-physical barriers and reap the benefits of liberalization which in turn will result in improved international trade and tourism. Other challenges are related to indirect barriers to market access like visa requirements, custom restrictions, constraints to ground handling and slot allocation. 6
The degrees of market access desired without the elimination of such barriers remains a hindrance to the sustainable development of air transport services in Africa and the world at large. Despite the above challenges, where Air Transport liberalization has been applied, whether in full or partially, we have seen significant benefits, including intra-African city pairing, improved connectivity and growth in passenger traffic. It is envisaged that our well-intentioned convergence here today, will inspire our deliberations and our collective endeavours towards achieving the intent and purpose of this assembly. Having noted the theme for this years Assembly, it is very clear that all efforts put in are geared to ensure that we improve our Airline Service Excellence. I will you all well in our deliberations Thank you 7
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