Africa’s ‘Moon Shot’: Preparing for an African air cargo renaissance
Cross-border cooperation
Another traditional hurdle that much of Africa has yet to clear has been its reluctance to cooperate with other nations in terms of open-skies agreements or free-trade zones. The continent, however, made some significant strides on this topic last year with the formation of the African Union’s Single African Air Transport Market (SAATM) agreement, which was adopted by 27 countries in Africa in 2018. “More are expected to sign up in 2019,” said Astral’s Gadhia.
“The purpose of SAATM is to create a single, unified air transport market for Africa, which will eliminate the need for separate bilateral air service agreements [BASAs] between individual African countries,” Gadhia said. In addition, SAATM will manage the free exercise of first, second, third, fourth and fifth freedom traffic to eligible African airlines; liberalize cargo services, air tariffs and unrestricted frequency and capacity; and adhere to the uniform rules for fair competition, consumer protection and other regulations.
All the while, Aero Africa’s Anderson also said that standards championed by the International Air Transport Association (IATA) are neither endorsed nor supported by most small forwarders in Africa. Outside of mature airfreight markets, like South Africa’s where multinational forwarders have corporate policies dictating IATA membership for all their offices, “you will struggle to find a general freight forwarder in Africa holding an IATA license or keeping the training or standards up to date.”
For most Africa-based freight forwarders, he said, export shipments are mostly handled on a cash basis directly with the carrier, or appointed general sales agent. “Therefore the general perception is that IATA membership is an otherwise avoidable expense that serves no direct revenue value or return,” he said.
“IATA needs more approachable, face-to-face integration with the freight forwarding community,” and with governments throughout Africa, Anderson suggested. “Without government support, IATA directives and standards are only adhered to at the last point of export control, meaning the airline-appointed ground handling agents, who are obliged to operate to IATA standards, and, of course, charge for such services.”
Overall, governments should seek to accelerate investments in the airfreight business, agreed DB Schenker’s De Silva. “Airlines and forwarders, together with other stakeholders, should push for attention from government and respective authorities to improve the facilities and quality of services provided,” he said. “We work closely with many global carriers to commit volumes, so that they can operate additional flights and offer capacity to the markets. We also have our subsidiary, which runs flight operations, based on specific requirements, offering charter flights to and from Africa.”
“Africa already enjoys regional free trade agreements, but it does not translate into air cargo activity in terms of permits or royalty costs between these members,” Anderson said. “Further endorsement of SAATM is promising,” he said, adding that “the drive towards a single African trade agreement would also prompt a more open-skies policy,” but that likely would not change much in 2019.
