IATA hinges economic growth on viable air transport sector

Albakri

Industry supports 490,000 jobs, contributes $12b to GDP in S’Africa
International Air Transport Association (IATA) has reiterated that air travel sectors in Africa, Nigeria and South Africa especially, are capable of transforming local economy.

IATA, the clearing house for over 260 airlines around the world, said besides massive job creation, the industry is capable of contributing significantly to the Gross Domestic Product (GDP), where its potentials are maximised.

The association observed that the air transport sector in South Africa currently provides immense value to the people and economy of the country supporting some 490,000 jobs including tourism-related employment and contributing $12 billion or 3.5 per cent to the country’s GDP.

These findings are among the highlights of ‘The Importance of Air Transport to South Africa’ (pdf) study conducted by Oxford Economics on behalf of IATA.

It will be recalled that the World Travel and Tourism Council (WTTC) recently estimated that air travel and tourism in Nigeria contributed 1.7 per cent to the country’s GDP, being $7.5 billion in 2016. Stakeholders said the figures were poor given the high population in Nigeria.

Muhammad Ali Albakri, IATA’s Regional Vice President for the Middle East & Africa, who is making his first visit to Africa in his new capacity, said the study from South African confirms the vital role of air transport in facilitating over US$110 billion in exports, some US$140 billion in foreign direct investment and around US$9.2 billion in inbound leisure and business tourism for South Africa.

Albakri said: “Now with the country in recession it’s time to re-double efforts to promote South Africa as a destination for business, trade and tourism,” he said, urging other countries to take a cue.

According to executives surveyed by the World Economic Forum for the study, South Africa’s transport infrastructure quality score places the country 1st out of 37 African countries surveyed and 48th globally

South Africa ranks 19th out of 37 African countries for visa openness. It ranks 17th out of 37 for cost competitiveness in the air transport industry, based on air ticket taxes, airport charges and Value Added Tax (VAT).

Around 390,000 aircraft land and take off from one of South Africa’s main airports every year. Johannesburg’s O.R. Tambo International Airport is the country’s busiest in terms of passengers with over 18.5 million travellers passing through the airport in 2014.

“Affordable, safe and reliable air transport is crucial to economic growth. It promotes skills development and is a catalyst for jobs. We urge the South African Government to remove any impediments, including unnecessary red-tape and policies that hinder air connectivity and the trade, investment, tourism and job opportunities it facilitates and stimulates,” Albakri said.