The report which shows how the COVID-19 Pandemic led to an $8.6b loss for African Airlines in 2021, also projects another loss of $4.9 billion in 2022
The report compiled by African Airlines Association (Afraa) and obtained by Investors King reveals how strict travel restrictions by many African countries led to the depletion in revenue of most airlines in 2021.
The pandemic was a major determining factor for the progression of many sectors of the economy in 2021. And while for many, losses were accounted due to the novel COVID-19 virus, experts in the aviation sector believe that less stringent travel restrictions in 2021 would have reduced the losses incurred by many African airlines.
The pandemic heightened losses for many sectors in 2020 and by 2021, a number of these sectors were said to be slowly recovering from their losses. And although the $8.6b loss according to Afraa, is a little less than the $10.21 billion revenue loss recorded by 2020, the result still shows a 49.8% decline when compared to the revenue recorded by the sector prior to the pandemic in 2019.
Investors King also collected that the report by AFraa disclosed that while a loss of $8.6 billion was incurred in 2021, in 2022, another loss of $4.9 billion may be incurred in 2022 owing to stricter travel restrictions and an ongoing crisis in Ethiopia.
The political crisis in Ethiopia may appear to have an even more devastating effect in the Eastern African region. According to the report, in 2021, only three African airlines continued with their international routes expansion across Ethiopia.
Other key takeaways from the report are the report on traffic for Africa Airlines and its projection as well as the report on safety practices for African Airlines under the year in review.
Traffic Projection
The report established that the pandemic reduced the traffic demands in 2020 and 2021, while also projecting a rise to meet the levels of 2019 before the pandemic. According to the report African airlines carried an estimated 43 million passengers in 2021 which represent around 45% of 2019 traffic while also projecting a rise in traffic by 67 million passengers in 2022
African Airlines Safety
The report went ahead to reveal that the total number of fatal accidents involving commercial airlines in 2020 were 5 – of which resulted in 301 fatalities. This is a welcomed improvement when compared to 2019, where there were 8 fatal accidents with 249 fatalities. According to the report, these accidents are notably from airline fatal accident records outside Africa, as no fatal accidents occurred in the African region or involved African regular carriers.
The report commended many African governments and aviation stakeholders for their efforts in ensuring that safety measures are carried out by various airlines operating in the regions. According to the report, under the year in review, there are 43 airlines registered in the (International Air Transport Association ) IATA Operational Safety Audit (IOSA).
Owing to the incurred loss in revenue, The AFRAA Secretariat continues to advocate for financial support to African airlines owing to the critical effect of the COVID-19. Investors King recalls that as of October 2021, a total of US$2.9 billion in various forms of support was extended to some airlines by their governments. The most African government to announce such according to the report is the Mauritius Government.
