The World Travel & Tourism Council’s (WTTC) 2023 Economic Impact Research (EIR) today reveals the UAE Travel & Tourism sector is projected to meet the 2019 peak this year.
The sector is set to contribute AED 180.6 billion to the UAE economy by the end of 2023, almost matching the 2019 high AED 183.4 billion, only 1.5% behind pre-pandemic levels. This represents nearly 10% of the total economy.
WTTC is also forecasting that the sector will create nearly 7,000 jobs this year, surpassing the pre-pandemic peak of 745,100, to reach more than 758,000 employed by Travel & Tourism.
A look back on last year
Last year, the Travel & Tourism sector’s GDP contribution grew more than 60% to reach nearly AED 167 billion, representing 9% of the country’s economy.
The sector also created more than 89,000 more jobs from the previous year to reach more than 751,000 jobs nationally, surpassing 2019 levels by an additional 6,000 jobs.
2022 saw the return of international travellers to the UAE, with India (13%), Oman (8%), Saudi Arabia (8%), and UK (7%) leading as source markets for international arrivals.
According to the data, in 2022, international visitors contributed AED 117.6 billion to the national economy, representing a year-on-year growth of 65.3%, although 19% behind 2019 levels.
In terms of domestic spend, 2022 saw a 35.7% year-on-year jump, reaching AED 46.9 billion, 10.6% above its pre-pandemic counterpart.
Julia Simpson, WTTC President & CEO, said: “The national Travel & Tourism sector is recovering at a rapid pace, proving the UAE continues to grow in popularity amongst international travellers. The UAE is home to one of the world’s busiest and successful airports, Dubai International, which acts as a gateway to the Middle East.
“The future for the sector looks positive. By the end of this year, the sector’s contribution will level that of 2019, and over the next decade, growth will outstrip the national GDP and create more than 114,000 new jobs, representing one in nine jobs.
“Our recent Cities EIR Report highlighted the appeal tourist destinations across the country, such as Dubai and Abu Dhabi, continue to hold for international travellers. These cities have shown an incredible resilience and strong leadership.”
What does the next decade look like?
The global tourism body is forecasting that the sector will grow its GDP contribution to AED 235.5 billion by 2033, representing 10.2% of the UAE economy.
Over the next decade, Travel & Tourism is set to employ more than 872,000 people across the country, representing nearly 12% of all jobs.
Middle East
In 2022, the Middle East’s Travel & Tourism sector contributed more than AED 1.2 trillion to the regional economy, 25.3% below the 2019 peak. By the end of this year, WTTC forecasts the regional sector’s GDP contribution will reach more than AED 1.5 trillion (U.S.$ 413.2 billion) and be within touching distance of the 2019 highpoint.
According to WTTC’s latest Economic Impact Report, the sector employed more than 6.8 million people across the region last year, an increase of 865,000 from the previous year, but still 8.7% behind the 2019 peak. The sector will nearly recover the jobs lost during the pandemic by the end of this year, only 2% behind pre-pandemic levels.
Over the next decade, the Travel & Tourism sector is projected to reach a contribution of nearly AED 2.5 trillion and employ more than 9.8 million people.
Tourism Minister Patricia de Lille says the COVID-19 pandemic undoubtedly left a dent in the tourism industry, but the resilient sector is recovering.
“South Africa offers travellers unparalleled beauty and affordability, making it an irresistible destination,” De Lille said when addressing a media briefing on the sidelines of Africa’s Travel Indaba, which is underway in Durban.
De Lille said the sector is geared to catapult inbound tourism numbers beyond pre-COVID-19 levels.
“Achieving this monumental goal requires a united front: government, private sector, and all tourism stakeholders joining forces to redefine the travel experience in our beloved country.”
She said 2022 heralded a resurgence, with nearly 5.8 million visitors gracing South Africa’s shores, including four million from Africa. This was a 152.6% increase from 2021.
“We’re not quite at the 10 million arrivals of 2019 but rest assured, our tireless collaboration with the private sector and Africa will take us there and beyond in no time.
“As the world reawakens, tourists are flocking back to South Africa, enticed by our unparalleled natural beauty and the warmth of our people. We are broadcasting a clear message – South Africa is open for tourism, welcoming business, and eagerly awaiting travelers from across Africa and the globe.”
De Lille said the world is rediscovering South Africa, and will that will not only reach but will surpass pre-COVID numbers.
“Our determination and unity will light the way to a brighter future for South African tourism. From a domestic perspective, we have seen an incredible resilience, with Q1 2023 performance surpassing pre-pandemic levels and those of Q1 2022,” De Lille said.
De Lille said tourists from Europe contributed the most spend of R10.8 billion, followed by Africa with a collective spend of R9.3 billion.
According to recent statistics, an impressive 2.1 million visitors were recorded, a 102.5% increase compared to the same period in 2022.
The African continent led the way again, with 1.6 million arrivals, followed by Europe’s 387 000 and the Americas’ 104 000 visitors.
De Lille said a significant driver of these remarkable figures is as a result of lifting of travel restrictions and affordability.
“After two years of restrictions and confinement, travellers are eager to explore wide-open spaces, and South Africa offers these in abundance,” De Lille said.
Over 500 000 Zimbabwean travellers journeyed to South Africa between January and March 2023 compared to 643 000 in the same period in 2019 and 173 000 in 2022.
Mozambique followed as the second-largest source market, boasting over 354 000 arrivals between January and March 2023.
According to De Lille, South Africa offers a diverse range of captivating destinations for travellers, with Gauteng taking the lead in international arrivals, spend and bed nights.
International visitors tend to spend most of their nights in the Western Cape, followed by Gauteng. The Eastern Cape, Northern Cape, KZN and the North West draw tourists to their unique charms.
UNWTO has launched a new report to determine the status of rural tourism in its Member States and identify the main challenges and opportunities for tourism as a driver for rural development from a policy perspective.
“Tourism and Rural Development: A Policy Perspective – Results of the UNWTO Survey on Tourism for Rural Development to Member States” represents the first baseline document of UNWTO on tourism and rural development undertaken with the participation of Member States worldwide.
Key Findings: Rural Tourism for Opportunity
More than half of all Member States (59%) stated that rural tourism is a priority Almost all Member States (96%) foresee a better future for rural tourism in the upcoming years The creation of new jobs, improvement of livelihoods and fighting depopulation were the most frequently-cited opportunities offered by tourism for rural areas Member States also identified the conservation and promotion of cultural heritage and environmental protection as among the biggest potential benefits of rural tourism.
The UNWTO research also identified three main challenges associated with realizing the potential of tourism for rural development:
The “infrastructure gap” in rural areas: Deficiencies in roads, ports, airports and other infrastructure that allow access to rural areas remain a challenge for the surveyed countries. Rural depopulation: Seasonality and product competitiveness add to this challenge, increasing the instability of rural businesses, which prevents the retention of population and human resources. The lack of education and training, as well as skills development, in addition to the capacity to attract and retain workforce talent.
Other challenges include limitations in accessing financial systems, restrictions in the development of innovative tourism products in rural areas, managing the impacts of degradation of natural resources, and limitations in handling data, digitalization, and knowledge management.
UNWTO: Advancing Tourism for the SDGs
In terms of how tourism can help in supporting the Sustainable Development Goals (SDGs), UNWTO Member States emphasized the potential of rural tourism for advancing SDG 8 (Decent Work and Economic Growth) SDG 1 (No Poverty), SDG 11 (Sustainable cities and communities) and SDG 5 (Gender Equality).
The report was launched during the 118th Session of the UNWTO Executive Council in Punta Cana, Dominican Republic. It forms part of the work of UNWTO’s Tourism for Rural Development Programme, established to develop initiatives and programmes to grow the sector in size and relevance as well as to monitor it in destinations worldwide.
Amadeus has signed a long-term, comprehensive technology partnership with Egyptair.
The deal is an extension of an existing relationship between the Egyptian flag-carrier and the travel technology leader, and comes as the airline refreshes its digital offering ahead of a renewed period of growth.
Yehia Zakaria, chief executive, Egyptair Group, said: “Amadeus is in a position to support Egyptair throughout its digital transformation, allowing us to provide customers with a best-in-class travel experience.
“Once these advanced solutions, including a new digital e-commerce platform are fully implemented, our employees will have the freedom and flexibility to better serve our passengers around the world.”
Included in the deal is Amadeus Revenue Management, which accurately forecasts demand by analyzing customer purchase behaviour, competitor pricing and yield capacity.
New digital solutions will also deliver a frictionless web and mobile experience to travelers while Amadeus Altéa Booking Intelligence will help minimize fraud.
Finally, Egyptair will migrate to a new loyalty platform, where members will benefit from customer-centric experiences based upon traveler insights.
Maher Koubaa, vice president, EMEA, airlines, Amadeus, said: “Amadeus has long been a trusted partner of Egyptair and the renewal we have signed will extend the relationship for many years to come.
“It also deepens the connection, with the flag-carrier positioning itself for future growth in the Middle East and beyond, thanks to the digital upgrade and operational enhancements that this suite of innovative solutions will deliver for Egyptair, its staff and customers.”
Amadeus continues to build its position in Egypt and the Middle East, with discussions ongoing with a number of other carriers in the region. Egyptair is the state-owned flag carrier of Egypt.
The airline is headquartered at Cairo International Airport, its main hub, and operates scheduled passenger and freight services to 81 destinations in the Middle East, Europe, Africa, Asia and the Americas.
The Emirates Group today released its 2022-23 Annual Report, reporting its most profitable year ever on the back of strong demand across its businesses. Emirates (airline) achieved new record profits, a complete turnaround from its loss position last year. Both Emirates and dnata (Dubai National Air Travel Agency) saw significant revenue increases in 2022-23 as the Group expanded its air transport and travel-related operations following the removal of nearly all pandemic-related restrictions around the world.
For the financial year ended 31 March 2023, the Emirates Group posted a record profit of AED 10.9 billion (US$ 3.0 billion) compared with an AED 3.8 billion (US$ 1.0 billion) loss for last year. The Group’s revenue was AED 119.8 billion (US$ 32.6 billion), an increase of 81% over last year’s results. The Group’s cash balance was AED 42.5 billion (US$ 11.6 billion), the highest ever reported, up 65% from last year mainly due to strong demand across its core business divisions and markets.
HH Sheikh Ahmed bin Saeed Al Maktoum, Chairman and Chief Executive, Emirates airline and Group, said: “We’re proud of our 2022-23 performance which is not only a full recovery, but also a record result. This achievement would not have been possible without HH Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President and Prime Minister, and Ruler of Dubai, whose leadership has been critical to our success today and through the years. The architect of Dubai’s progressive economic policies, HH Sheikh Mohammed is also the engine behind the Emirates Group’s trajectory. Without his drive and support, Emirates will be half the size of what we are today.”
Are you a part of the travel industry in Kenya? Are you seeking an unparalleled opportunity to learn, network, and foster new business connections? If so, mark your calendar for 16th June 2023 and join us at the 2023 Kenya Association of Travel Agents (KATA) Travel Convention and AGM in Naivasha. This exclusive event is the pinnacle of travel industry gatherings in Kenya, and it is one that you absolutely cannot afford to miss.
The KATA Travel Convention is meticulously designed to promote collaborative efforts and partnerships among the most prominent stakeholders in the travel industry. With a well-crafted program that facilitates open dialogue, constructive critique, and self-reflection, attendees can partake in a variety of sessions that cover critical issues affecting the industry. If you’re someone who wants to ensure the future prosperity and sustainability of Kenya’s travel sector, then this event is a must-attend for you.
What can you anticipate from the KATA Travel Convention?
Expect to build valuable networks and form vital alliances with fellow industry players, forging new business connections and partnerships along the way. The program areas will focus on critical topics like the future of travel, making big moves in the travel industry, bouncing back stronger, among other immersive business sessions. With such a diverse array of themes, this event is truly an all-encompassing one, catering to everyone in the industry.
The event’s theme, “New Normal. New Thinking. New Rules,” is aligned with the emerging trends across Africa’s aviation industry to improve both domestic and international air connectivity, thereby increasing air traffic within Kenya and its neighboring regions. According to the World Tourism Organization (UNWTO), tourism and aviation in Africa are two sides of the same coin. Despite the limitations of fragmented airspace and policies that restrict the free movement of air travel passengers from one country to another, tourism has played a crucial role in driving air traffic to, from, and within Africa for over three decades.
Attending the KATA Convention and AGM presents a unique opportunity to discuss strategies for building a strong and resilient travel industry in the face of an ever-changing business environment. You can gain valuable insights into the emerging trends in Africa’s aviation industry and how they are aligning with the event’s theme to drive tourism in and out of the continent, consequently influencing the aviation industry over the next two decades.
This event is essential for tour operators, travel agents, airline representatives, GDS partners, government officials, and other industry players looking to establish a robust and resilient travel industry amidst the evolving business landscape. With a program designed to promote collaboration and partnerships among key stakeholders in the travel industry, attendees can expect to learn, connect, and generate new business opportunities.
Don’t miss out on the chance to be a part of the discussion; register now to secure your spot at Kenya’s premier business event for travel industry leaders. Contact info@katakenya.org or call +254-792 000 835
Bryan Obala – For Membership, Marketing and Communications Desk
Due to lack of transparency, a Kenyan High Court has ordered a fresh valuation of charter carrier Bluebird Aviation (Kenya) amid a buy-out dispute between shareholders, reports Standard Media in Nairobi.
According to ch-aviation.com, Commercial Court division Judge Njoki Mwangi has set aside a valuation report tabled in court last year valuing the shares of founder Adan Abid Yusuf at KES320 million Kenyan shilling (USD2.3 million), according to the Nation Media Group.
The judge found there was no transparency and independence in the preparation of the valuation report compiled by RSM (East Africa) Consulting Ltd on behalf of Yusuf’s partners, former Kenya Air Force officers Hussein Farah and Hussein Mohammed and pilot Mohammed Abdikadir, who each own 25% of the company. The airline was founded in 1992 to transport shipments of miraa or khat to Somalia, a stimulant plant native to East Africa and the Arabian Peninsula.
However, a shareholder fallout has seen Yusuf file multiple legal actions against his partners over the years, resulting in the High Court directing his partners to buy him out three years ago. The valuation report assessed the value of the carrier’s aircraft, land and buildings at Nairobi Wilson, reviewed its balance sheet and prepared a financial model incorporating historical performance over the preceding three years. Upon conclusion, the report was prepared and shared with the parties, and the money was wired to a judiciary account. Yusuf’s shares were transferred to Abdikadir.
However, Yusuf challenged the report arguing that the KES320 million was a speculative figure. He was supplied with the report on December 6, 2021, but the airline’s audited financial statements for the financial years from 2017 to 2021 were not provided as backup.
The judge directed the four parties to appoint a new valuer. If the value of the airline is found to be less, the airline would be refunded from the amount already deposited in the judiciary account. If the value is found to be more, the airline would have seven days from the new report being filed to top up the difference. The sum held in court will be released to the applicant’s (Yusuf’s) advocate within seven days of filing the new valuation report in court. Yusuf will bear the cost of the new valuation.
According to the ch-aviation fleets advanced module, Bluebird Aviation operates a fleet of ten (mostly leased) aircraft, including four DHC-8-100s, one DHC-8-Q400, three DHC-8-Q400(PF) freighters, and two F50s
International Air Transport Association (IATA) has said African airlines saw overall cargo volumes decline 6.2 percent in March 2023 compared to March 2022.
The latest update of the global aviation body indicated that capacity was 4.1 percent below March 2022 levels.
According to logupdateafrica.com, “This was an improvement in performance compared to the previous month (-7.4 percent). Notably, Africa to Asia routes experienced significant cargo demand growth in March.” Global demand, measured in cargo tonne-kilometres (CTKs), fell 7.7 percent in March compared to March 2022 (-8.1 percent for international operations).
“This was a slight improvement over February 2023 performance (-9.4 percent) and half the rate of annual decline seen in January and December (-16.8 percent and -15.6 percent, respectively). At this point, it is unclear if this is a potentially modest start of an improvement trend or the upside of market volatility. Irrespective of this, March performance slipped back into negative territory compared to pre-Covid levels (-8.1 percent).”
Capacity (measured in available cargo tonne-kilometres, ACTK) increased 9.9 percent YoY. “The strong uptick in ACTKs reflects the addition of belly capacity as the passenger side of the business continues to recover.”
Willie Walsh, Director General, IATA says: “Air cargo had a volatile first quarter. In March, overall demand slipped back below pre-Covid-19 levels and most of the indicators for the fundamental drivers of air cargo demand are weak or weakening. While the trading environment is tough, there is some good news. Airlines are getting help in managing through the volatility with yields that have remained high and fuel prices that have moderated from exceptionally high levels. Looking ahead, with inflation reducing in G7 countries, policy makers are expected to ease economic cooling measures and that would stimulate demand.”
Regional performance
Asia-Pacific airlines saw their air cargo volumes decrease by 7.3 percent in March 2023 compared to the same month in 2022. This was a slight decrease in performance compared to February (-5.4 percent). “The drop in demand suggests that air cargo traffic in the region has not yet stabilised following China’s reopening in January. Available capacity in the region increased by 23.6 percent compared to March 2022 as more belly capacity came online from the passenger side of the business.”
North American carriers posted the weakest performance of all regions with a 9.4 percent decrease in volumes compared to the same month in 2022.
“The transatlantic route between North America and Europe saw traffic declining at an accelerated pace throughout March. Capacity increased 0.4 percent compared to March 2022.”
European carriers saw the most substantial improvement in demand in March over the previous month. Airlines in the region saw volumes decrease by 7.8 percent in March 2023 compared to the same month in 2022. This was an improvement in performance versus February (-15.9 percent). “Airlines in the region continue to be most affected by the war in Ukraine. Capacity increased 8.8 percent in March 2023 compared to March 2022.”
Middle Eastern carriers experienced a 5.5 percent year-on-year decrease in volumes in March 2023. “This was also an improvement to the previous month’s decline (-7.1 percent). The demand on Middle East-Europe routes has been trending upward in recent months. Capacity increased 9.7 percent compared to March 2022.”
Latin American carriers had the strongest performance of all regions in March despite posting a decline in performance over the previous month. “Carriers in the region reported a 5.3 percent decrease in cargo volumes in March 2023 compared to March 2022. This was a drop in performance compared to February which saw a 2.9 percent decline. Capacity in March was up 12.9 percent compared to the same month in 2022.”
International Air Transport Association (IATA) has said African airlines saw overall cargo volumes decline 6.2 percent in March 2023 compared to March 2022.
The latest update of the global aviation body indicated that capacity was 4.1 percent below March 2022 levels.
According to logupdateafrica.com, “This was an improvement in performance compared to the previous month (-7.4 percent). Notably, Africa to Asia routes experienced significant cargo demand growth in March.” Global demand, measured in cargo tonne-kilometres (CTKs), fell 7.7 percent in March compared to March 2022 (-8.1 percent for international operations).
“This was a slight improvement over February 2023 performance (-9.4 percent) and half the rate of annual decline seen in January and December (-16.8 percent and -15.6 percent, respectively). At this point, it is unclear if this is a potentially modest start of an improvement trend or the upside of market volatility. Irrespective of this, March performance slipped back into negative territory compared to pre-Covid levels (-8.1 percent).”
Capacity (measured in available cargo tonne-kilometres, ACTK) increased 9.9 percent YoY. “The strong uptick in ACTKs reflects the addition of belly capacity as the passenger side of the business continues to recover.”
Willie Walsh, Director General, IATA says: “Air cargo had a volatile first quarter. In March, overall demand slipped back below pre-Covid-19 levels and most of the indicators for the fundamental drivers of air cargo demand are weak or weakening. While the trading environment is tough, there is some good news. Airlines are getting help in managing through the volatility with yields that have remained high and fuel prices that have moderated from exceptionally high levels. Looking ahead, with inflation reducing in G7 countries, policy makers are expected to ease economic cooling measures and that would stimulate demand.”
Regional performance
Asia-Pacific airlines saw their air cargo volumes decrease by 7.3 percent in March 2023 compared to the same month in 2022. This was a slight decrease in performance compared to February (-5.4 percent). “The drop in demand suggests that air cargo traffic in the region has not yet stabilised following China’s reopening in January. Available capacity in the region increased by 23.6 percent compared to March 2022 as more belly capacity came online from the passenger side of the business.”
North American carriers posted the weakest performance of all regions with a 9.4 percent decrease in volumes compared to the same month in 2022.
“The transatlantic route between North America and Europe saw traffic declining at an accelerated pace throughout March. Capacity increased 0.4 percent compared to March 2022.”
European carriers saw the most substantial improvement in demand in March over the previous month. Airlines in the region saw volumes decrease by 7.8 percent in March 2023 compared to the same month in 2022. This was an improvement in performance versus February (-15.9 percent). “Airlines in the region continue to be most affected by the war in Ukraine. Capacity increased 8.8 percent in March 2023 compared to March 2022.”
Middle Eastern carriers experienced a 5.5 percent year-on-year decrease in volumes in March 2023. “This was also an improvement to the previous month’s decline (-7.1 percent). The demand on Middle East-Europe routes has been trending upward in recent months. Capacity increased 9.7 percent compared to March 2022.”
Latin American carriers had the strongest performance of all regions in March despite posting a decline in performance over the previous month. “Carriers in the region reported a 5.3 percent decrease in cargo volumes in March 2023 compared to March 2022. This was a drop in performance compared to February which saw a 2.9 percent decline. Capacity in March was up 12.9 percent compared to the same month in 2022.”
The airline started service to the country nearly 60 years ago.
After a hiatus of nearly two decades, Ethiopian Airlines restarted service to Pakistan this week. With 110 passengers onboard, the flight arrived in Karachi on Monday, formally completing the prerequisites to re-launch the service.
The airline will operate multiple flights per week between Addis Ababa and Karachi. Jamal Bakir Abdullah, the Ambassador of Ethiopia, said the service promotes trade and tourism between both countries.
A warm welcome
According to SAMAA, Ethiopian officials, diplomats, and a trade delegation flew in on Monday’s flight that completed the prerequisites. They were welcomed by Sindh Chief Minister Syed Murad Ali Shah and his team, as well as other Pakistani officials, including Sharjeel Memon, Nasir Shah, Ikramullah Dharejo, and Murtaza Wahab.
The new flights come as several foreign airlines have faced challenges operating in Pakistan. Ethiopian Airlines CEO Mesfin Tasew spoke about the airline returning to Pakistan.
Improving trade and the economy
The resumed service is expected to strengthen the relations between both countries and boost the economy. The airline will operate four flights per week, according to ARY News.
“As the only flight connecting Pakistan with Africa, the planned service to Karachi will have a significant contribution in strengthening the diplomatic and economic relations between the two regions,” Tasew said to ARY News.
Nearly 40 destinations in Asia
Ethiopian’s Foreign Minister will reportedly fly to Karachi on the first flight of the regular operation on Tuesday. Abdulla mentioned that Ethiopia is a significant market and attracts trade from several diverse sectors in Pakistan, such as pharmaceuticals, surgical instruments, etc.
To celebrate the resumed flights, Ethiopian Minister of Foreign Affairs Misganu Arega and the delegation will visit Pakistan for two days. During the visit, both Arega and Minister of State for Foreign Affairs, Hina Rabbani Khar, are expected to open the Embassy of Ethiopia from Islamabad, according to ARY News.
Karachi is the airline’s 37th destination in Asia. In March, the carrier finalized preparations to begin the flights. In July 1966, Ethiopian Airlines inaugurated service to Karachi and served the city until December 1971. Service then resumed in June 1993 and lasted until 2004. Currently, the carrier serves more than 145 domestic and international cargo destinations.
The Kenyan Government is seeking a Private Public Partnership (PPP), to build both a second runway and a new terminal building aimed at doubling the airport’s passenger handling capacity.
According to centreforaviation.com, slowly but surely Africa is starting to attract more external investment and management expertise into its airports, despite all the actual and perceived negatives about participating there.
Qatar Airways is involved with a new airport in Rwanda, and VINCI has multiple concessions across the Cape Verde archipelago. Chinese companies are thereabouts, always looking out for the main chance.
In Kenya the state airline tried to take operational control of Nairobi’s Jomo Kenyatta International Airport, the continent’s 11th busiest, in 2022. As the airport is the airline’s main base, Kenya Airways must have been concerned that two separate attempts to build a second runway there had floundered, the second one supported by the African Development Bank.
Now the government is seeking partners in a PPP to build both a second runway and a new terminal building. But such a commitment might not be attractive to many potential investors when traffic numbers remain low by international standards, and while concerns about political opaqueness remain.
This is part one of a two-part report.
New terminal and second runway to be built at Nairobi’s main airport; government hopes for PPP agreement.
Kenya’s Cabinet Secretary for Roads, Transport, and Public Works Kipchumba Murkomen said that the government intended to construct a new ‘state of the art’ passenger terminal at Nairobi Jomo Kenyatta International Airport (JKIA).
Mr Murkomen added that the government was seeking a public private partnership (PPP) model for the works, which would include a new runway. The project will aim to double the airport’s passenger handling capacity.
Mr Murkomen said that this would solve the challenge facing the airport in terms of its capacity to serve passengers, which has led to “inefficiencies and breakdown in systems.” He also noted that it would “provide jobs, boost tourism, trade and investment, and enhance regional integration”.
He then went on to say that with the airport being a key port of entry for Kenya, it would be critical that the government worked on a PPP model that would facilitate the expansion of JKIA and “move to the list of the best airports in the world”.
He urged the board to work with the government, stakeholders and investors to achieve the plan, and asked the board to review the KAA Act 1991 so that it could “concur with current developments in the aviation sector”.
He concluded that there was a need to enhance security at JKIA and other airports in the country, both physical and cyber.
Need to reposition the airport as the main East Africa gateway and to tap into increased investor interest in the continent.
There are two factors in play here. Firstly, a need to reposition Nairobi Airport so that it can challenge others in East Africa – notably the existing and new Addis Ababa airports in Ethiopia – as the regional gateway, and secondly, so that it can tap into a small but viable increase in interest in investing in African aviation from outside the continent – such as Qatar Airways’ investment in the new airport at Kigali, Rwanda.
Steady traffic growth before the pandemic; capacity slowly recovering Passenger traffic grew steadily – if not spectacularly – at Nairobi from 2014 to 2019, before succumbing, like everywhere else, to the COVID-19 pandemic in 2019.
Capacity has not yet retrieved the position of 2019 but is narrowing the gap. As of the week commencing 17-Apr-2023, it stands at around 88% of what it was in the same week of 2019.
Kenya Airways and its LCC are dominant, hence also SkyTeam. The national carrier Kenya Airways is the dominant airline, with 49% of capacity and between 46% and 50% of movements between peak and off-peak.
The second largest airline by capacity is its fully owned LCC subsidiary Jambojet (15%).
Jambojet was established to help meet rising competition in Kenya Airways’ core markets from new independent LCCs.
Nairobi Jomo Kenyatta International Airport: system seats by airline, week commencing 24-Apr-2023
The LCC model is better established in East Africa than in other regions of the country but even so, in Kenya only 2.7% of international seats are ‘low cost’ and the domestic market accounts for just 6.5% (Jan-Apr-2023). The figures are marginally higher in East Africa as a whole.
At JKIA 16.55% of seats are presently offered by LCCs, which is an unexpectedly high amount, but even so it is not a burgeoning demand for budget travel that necessitates a new terminal building and runway.
A broad north-south network but remains weak to the Americas and Asia Pacific.
As expected, most of the capacity is on East African routes, followed by the Middle East and Western Europe. Nairobi Jomo Kenyatta International Airport: network map for the week commencing 24-Apr-2023
The single international country with the highest capacity is the UAE, followed by Tanzania, South Africa, the UK and Ethiopia. That suggests quite a broad network at Nairobi, and that is certainly the case, or at least it is on a north-south axis as the below map details.
There are many routes in East Africa and the Middle East and an adequate network in Europe for passengers via the main gateways, and for cargo.
Within recent memory there were few east-west routes across Africa, often necessitating a journey to a European or Middle East transit point to get between the two, but Nairobi does now have five destinations in that region.
The weak links are undeniably the Americas – with only one trans Atlantic service, to New York – and Asia Pacific, with two services to India (Delhi, Mumbai) and two Chinese ones (Changsha and Guangzhou, which began in Apr-2023).
Despite the airport’s elevation, at over 5,000ft (1524m), the single 4,200m runway should be adequate to handle most long-haul flights out of Nairobi, and that is another reason why ‘a second runway is needed’ can be discounted.
On the other hand, there are concerns about what happens when that runway is closed, as revealed later.
The only substantially longer routes that might be flown (that are not now) would be to the west coast of the US and Canada, to South Korea and Japan, and to Iceland (the two countries are coincidentally connected by the fishing industry, Iceland selling its advanced technology widely to African countries).
So the two main concerns behind this expansion seem to be capacity and planning for future growth.
Current utilisation of existing facilities is high on most days
Where capacity is concerned, usage is high. The chart below is for Thursday 27-Apr-2023 and shows all but one of the 24-hour blocks in use for departing and/or arriving flights (as measured by their seat capacity). Most other days are much the same.
All three major airlines alliances are present
JKIA also benefits from the presence of all three of the major airline alliances, and particularly SkyTeam (by way of Kenya Airways), which has 55% of the capacity – its main competitor in the region, Addis Ababa Bole Airport, has 97% of capacity on one alliance, Star.
There are two terminals. Terminal 1 is arranged in a semi-circular manner and is divided into four distinct parts rather than concourses.
Terminals 1A, 1B, 1C, and 1E are used for international arrivals and departures, and 1D is used for domestic departures and arrivals.
Terminal 2 is used by low-cost carriers, and right now is tiny by comparison, with less than 1,000 seats of capacity for the whole of the week commencing 24-Apr-2023.
