Why Ghana needs a national airline

Why Ghana needs a national airline
Source: Ghana | Sandra Esinam Afenu | JoyBusiness
Date: 12-11-2018 Time: 04:11:40:pm

 In Africa, air transport supports 6.8 million jobs and $72.5 billion dollars of the continents GDP annually. Statistics have indicated that Airline Business in Africa is growing as more countries are purchasing to have their own national air carriers.

As at the end of 2017, the European Aeronautic Defence and Space Company Airbus received 261 orders from African countries for their own air crafts with 28 new operators adding up to the existing.

As the world’s largest in terms of population, experts say Air Transport in Africa will massively increase from 1.2 billion in 2016 to  1.68 billion by 2030.

Industry experts say Tourism in Africa will massively increase in the next 15 years from 52 million in 2012 to 134 million 2030 and expected to multiply by 10 in 40 years hence the need for African countries to pay attention to the aviation industry.

National airline’s core impact on GDP & jobs in Africa

Already some African countries are making huge gains from having National Airlines.

In 2014 Zambia made over 14 million dollars from rose exportation, Ethiopia, exported over 154 million dollars in 2014 while Kenya’s went up to the tune 326 million dollars the same year.

These three countries provided more jobs than the mining industry translating into $225m in 2016 $820m in 2017.

Being a perishable good, vibrant air transport in these three countries made a significant impact.

There are several other African countries including, Ethiopia, Zambia Togo, Seychelles, Mauritius and Cote d Ivoire benefiting greatly from their aviation industries.

Togo national airline

Tourist arrival per year in Togo, for instance, is said to have more than tripled from 50,000 in 1995 to 350,000 in 2015 since the creation of Togo’s national airline.

Air Cote D'Ivoire 

Just five years after the creation air Cote d'Ivoire national, tourist arrival also doubled from 800, 000 in 1990 to 220, and million in 2017.

Air Mauritius

The direct impact of tourism on Mauritius’ economy as a result of having a national airline was 45,500 representing 8.2% of total employment with a total of 135,000 jobs created the same year.

Air Seychelles

The story of Seychelles is not different.

With just a population of 95,235, 22.0 per cent of Seychelles’s GDP is generated from the tourism industry.

This is because the country has invested in having a national airline which has translated into jobs employing a total of 29 thousand in the hospitality industry.

Air Namibia

Another shining example in Africa is air Namibia.

Between 2015 and 2016 Air Namibia reported a $3.5 million in profit from its operations and paid $21 million in wages and salaries.

The airline also made 55 million dollars in indirect GDP contribution, as a result of supply chain activities linked to the airline’s procurements.

The sad story of Ghana’s national airline

After the collapse of the national airline in 2010, Ghana has been without a national carrier.

Free boarding passes, mismanagement and government interference with operations were among several other factors said to have led to the collapse of the hitherto vibrant Ghana Airways.

After several postponements of the launch of a new national airline, many say it’s about time Ghana sees the aviation sector as key to its economic growth.

So far two deadlines for the re-launch of what is now to be called the home-based carrier.

First in 2015 and 2016. These promises are yet to be fulfilled.

That not  withstanding, the current government says it is committed to reviving the national airline.

The Ghana Civil Aviation Authority (GCAA), has said a new national airline, expected to commence by 2019, will not tolerate a free ticket regime which was heavily exploited by government officials leading to the demise of Ghana Airways and its successor, the Ghana International Airlines.

With a recent policy approval by Parliament, for the establishment of a new home-based carrier by the Aviation Ministry and the Ghana Airports Company, there are reports that, a host of airlines including Ethiopian Airlines, Air Mauritius, and African World Airline are currently are in talks with government for the establishment of the national airline.

Speaking to JoyBusiness in Toulouse, France former chief executive officer of Ethiopian airline, Girma Wake said Ghana would have to take a cue from Ethiopia in its quest to re-launch the home base carrier.

He added that Ethiopian air has been a success story in Africa because its management was devoid of government interference.

‘“For me, it doesn’t matter who owns an airline. Ethiopian airline is 100 per cent government but the government has allowed the airline to be run on commercial bases. Complete independent body to run the airline. If they were to do what many African carriers do, interfering in everything Ethiopian airline will not be where it is today. 

African countries should be able to say, is ok, here is our airline, here is our seed money, and we created the airline, let’s put proper management in place to do their job. I am sure this can be done. Many European carriers until 20 years ago were all government owned. They gradually came to this private thing. Africa is not yet ready for a complete private airline. We need government involvement in our airlines. The government can push an airline to do what they want them to do, not in a way of interference but in a way of development and it can be done.”

Vice president of Africa international air transport association, Raphael Kuuchi, is however not in favour of government stakes in national airlines.
“Ethiopian is a different case, they have a business model that is completely devoid of government interference and run extremely professionally. It is very difficult and tempting for governments to stay away from interfering in aviation. What we want is to see is that government’s limit the extent of involvement in aviation. 

We are not saying governments should be hands off, after all, the government is the one that has to create the policy environment and regulations so we need government but not for the operations of the airline but policy and regulatory aspects of the industry. What I want to see Ghana do is that, if the government wants to have a stake in the national carrier, it should be a minimum stake and not a controlling stake and allow the private sector to drive it.”

With an estimated 385 million people in West Africa as of 2017, there are enormous potentials for the aviation sector.

The latest Airbus Global Market Forecast 2017-2036, titled ‘Growing Horizons’,  shows that over half of global tourists travel across international borders each year on air transport routines.

Ghana’s aviation industry

Over the past decade, Ghana’s aviation sector has grown by about 8 per cent annually.

In 2017, total international passengers through both arrivals and departure was 1.8 million mostly from Europe, North America and Asia.

Key international and regional airlines operating as of now through Accra include Air France, Emirates, British Airways, Turkish Airlines, Brussels Delta, Ethiopian, South African Airways, Air Namibia African World Airlines among others.

Several Africa countries including Ethiopia, Zambia, Togo and Kenya are raking in on their aviation sectors making huge contributions to their economies.

Experts say if Ghana really wants to see a surge in its economy, there is the need to pay critical attention to the aviation sector.