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AFRAA, TMAM sign MoU to enhance airline/airport operations in Africa.

The African Airlines Association (AFRAA) has signed a memorandum of understanding (MoU) with the Terminals Malabo Airport Management (TMAM) to develop coordinated synergies that will align efforts to enhance airport and airline operations in Africa.

The MoU was signed by Abdérahmane Berthé, Secretary General, AFRAA and Ahmed Al Hadabi, Group CEO, Terminals Group on the sidelines of the Future of Air Transportation Summit in Malabo, Equatorial Guinea, says a release from AFRAA. “AFRAA and TMAM will focus on the following areas of collaboration:

*Efforts to promotion of travel and tourism within Africa

*Data sharing and analytics

*Initiatives to enhance operational efficiencies, customer service, and strategic planning

*Environmental sustainability

*Airport infrastructure development

*Training and capacity building

*Innovation and technology

*Emergency response and crisis management

*Special handling services

*Enhancement of customer service for passengers; and

*Advocacy and policy engagement.

” An annual work plan shall be developed to set and track progress of activities between AFRAA and TMAM, the release added.

Source:  Logistics Update Africa.

Nigeria Still Owes Foreign Airlines $700+ Million.

The Central Bank of Nigeria (CBN) has released an additional $64.4 million of blocked airline funds as part of its move to clear its foreign currency backlog and reduce liability to operators. However, about $700 million of airline funds remain trapped in the country as of January 2023.

CBN releases additional funds.

The failure of foreign airlines to repatriate funds from Nigeria and other countries has become a serious issue over the last few years. As noted by the International Air Transport Association (IATA), it is among the biggest impediments to the development of aviation in certain markets. However, this year, Nigeria has made some progress in clearing its backlog.

According to the central bank’s Acting Director of Corporate Communications, Hakama Sidi-Ali, the financial institution released $64.44 million of blocked airline funds on January 30, 2024. This brings the total verified amount disbursed to foreign carriers to $136 million. As reported by Reuters, the bank is continuing efforts to clear all verified backlogs.

“The Governor, Olayemi Cardoso, and his team were doubly committed and would stop at nothing to ensure that the verified backlog of payments across all other sectors was cleared, and confidence was restored in the Nigerian foreign exchange market.”

Ali added that all verified claims have been cleared with this latest payment. Earlier this year, the central bank announced that it had released approximately $61.64 million belonging to foreign airlines through various banks. In total, about $2.5 billion of the backlog has been cleared across various sectors like manufacturing, petroleum, and air transport.

About $700 million remains blocked in Nigeria

While it is only a small percentage of the total amount of trapped funds in Nigeria, disbursing an additional $64 million is another step in the right direction. Responding to the central bank’s announcement, IATA welcomed the development but noted that there is still a long way to go before the issue is resolved. IATA said in a statement,

“The International Air Transport Association (IATA) welcomes the Central Bank of Nigeria’s announcement this afternoon that it has released an additional $64.44 million in blocked airline funds. We are consulting with our airline members to verify the release of their revenues.”

The association added that approximately $700 million remains blocked with Nigeria’s commercial banks. The situation in the West African country remains critical due to the devaluation of the Nigerian Naira (₦), which has dropped significantly against the US dollar. As such, foreign operators unfairly suffer due to lower exchange rates.

IATA will continue to work with the government to find solutions and maintain a conducive environment that ensures connectivity to various international markets. Nigeria has already suffered the effects of blocked funds, with Emirates suspending flights in 2022. The new administration has been working hard to have the Dubai-based carrier return to Nigeria and re-establish connections with the UAE.

International airlines serving Nigeria.

Despite challenges with retrieving funds, several international carriers still serve Nigeria. The country’s two main international airports, Lagos Murtala Muhammed (LOS) and Abuja Nnamdi Azikiwe (ABV), are among the busiest in West Africa and the continent. In 2022, while still recovering from the pandemic, Nigerian airports handled over 16 million passengers.

Last year, there were over 26 international carriers with scheduled flights to and from Nigeria. Among the local carriers, Air Peace has the most flights out of Nigeria, connecting the country to 11 international destinations. The top foreign carriers include Africa World Airlines, Ethiopian Airlines, Qatar Airways, British Airways, and Lufthansa. Some carriers like Air France, British Airways, Ethiopian, and Qatar serve both Lagos and Abuja.

What are your thoughts on the Central Bank of Nigeria releasing additional airline funds? Please let us know in the comment section.

Source: Simple Flying.

IATA : Global Air Travel Demand Continued Its Bounce Back in 2023

The International Air Transport Association (IATA) announced that the recovery in air travel continued in December 2023 and total 2023 traffic edged even closer to matching pre-pandemic demand.

•    Total traffic in 2023 (measured in revenue passenger kilometers or RPKs) rose 36.9% compared to 2022. Globally, full year 2023 traffic was at 94.1% of pre-pandemic (2019) levels. December 2023 total traffic rose 25.3% compared to December 2022 and reached 97.5% of the December 2019 level. Fourth quarter traffic was at 98.2% of 2019, reflecting the strong recovery towards the end of the year.

•    International traffic in 2023 climbed 41.6% versus 2022 and reached 88.6% of 2019 levels. December 2023 international traffic climbed 24.2% over December 2022, reaching 94.7% of the level in December 2019. Fourth quarter traffic was at 94.5% of 2019.

•    Domestic traffic for 2023 rose 30.4% compared to the prior year. 2023 domestic traffic was 3.9% above the full year 2019 level. December 2023 domestic traffic was up 27.0% over the year earlier period and was at 2.3% above December 2019 traffic. Fourth quarter traffic was 4.4% higher than the same quarter in 2019.

“The strong post-pandemic rebound continued in 2023. December traffic stood just 2.5% below 2019 levels, with a strong performance in quarter 4, teeing-up airlines for a return to normal growth patterns in 2024. The recovery in travel is good news. The restoration of connectivity is powering the global economy as people travel to do business, further their educations, take hard-earned vacations and much more. But to maximize the benefits of air travel in the post-pandemic world, governments need to take a strategic approach. That means providing cost-efficient infrastructure to meet demand, incentivizing Sustainable Aviation Fuel (SAF) production to meet our net zero carbon emission goal by 2050, and adopting regulations that deliver a clear cost-benefit. Completing the recovery must not be an excuse for governments to forget the critical role of aviation to increasing the prosperity and well-being of people and businesses the world over,” said Willie Walsh, IATA’s Director General.

CARGO

The International Air Transport Association (IATA) released data for global air freight markets showing that air cargo demand rebounded in 2023 with a particularly strong fourth quarter performance despite economic uncertainties. Full-year demand reached a level just slightly below 2022 and 2019.

Global full-year demand in 2023, measured in cargo tonne-kilometers (CTKs), was down 1.9% compared to 2022 (-2.2% for international operations). Compared to 2019, it was down 3.6% (-3.8 for international operations).

Capacity in 2023, measured in available cargo tonne-kilometers (ACTKs), was 11.3% above 2022 (+9.6% for international operations). Compared to 2019 (pre-COVID) levels, capacity was up 2.5% (0.0% for international operations).

December 2023 saw an exceptionally strong performance: global demand was 10.8% above 2022 levels (+11.5% for international operations). This was the strongest annual growth performance over the past two years. Global capacity was 13.6% above 2022 levels (+14.1% for international operations).

Some indicators to note include:

Global cross-border trade recorded growth for the third consecutive month in October, reversing its previous downward trend.

December inflation in both the United States and the EU as measured by the corresponding Consumer Price Indices (CPI) stayed below 3.5% year-on-year. China’s CPI, however, indicated deflation for the third consecutive month, raising concerns of an economic slowdown.

Both the manufacturing output and new export order Purchasing Managers Indexes (PMIs) – two leading indicators of global air cargo demand—continued to hover below the 50-mark in December, usual markers for contraction.

“Despite political and economic challenges, 2023 saw air cargo markets regain ground lost in 2022 after the extraordinary COVID peak in 2021. Although full year demand was shy of pre-COVID levels by 3.6%, the significant strengthening in the last quarter is a sign that markets are stabilizing towards more normal demand patterns. That puts the industry on very solid ground for success in 2024. But with continued, and in some cases intensifying, instability in geopolitics and economic forces, little should be taken for granted in the months ahead,” said Willie Walsh, IATA’s Director General.

Source: Travel and tour world.

Nigeria: Airlines’ Trapped Funds – Pressure Mounts Despite U.S.$61 Million Release.

Lagos — There’s a mounting pressure on the federal government to make significant releases to clear the foreign airlines’ trapped funds amidst their threat to exit Nigeria.

This is despite the release of $61.4m by the Central Bank of Nigeria (CBN) last week as part of efforts to clear outstanding liabilities and bolster the foreign exchange market.

While there’s no updated data on the foreign airlines’ funds trapped in Nigeria, our correspondent reports that the money was $793m as of December 2023.

According to data from the International Air Transport Association (IATA), Nigeria accounted for a substantial part of airlines’ trapped funds globally.

The foreign airlines said the funds keep mounting hence the $61.4m was too infinitesimal to cover anything.

A foreign airline representative who spoke with our correspondent in confidence said the trapped funds hinder the operations of their airlines.

“We all know what the margin is for airlines. If your funds are trapped to that level, how do you fund your operations? From loans or what? You can fund from other locations for how long? If every nation holds back funds, will there be international flights?

Foreign airlines mull cut of Nigerian operations.

Amidst the raging controversy over dollar settlement, airlines are said to be considering the option of reducing or suspending their operations outright.

It was learnt that despite the substantial resolution of diplomatic issues with the United Arab Emirates (UAE), the non-payment of Emirates Airlines’ trapped funds is responsible for the delay in resumption of flights to Nigeria.

“The airline is yet to see sufficient commitment of the Nigerian government to clear Emirates trapped funds which is the major reason for the airline’s suspension of operations in the first place,” the source said.

It would be recalled that Emirates suspended all flights to Nigeria on September 1, 2022 and despite two different visits of President Bola Tinubu to the UAE and follow-up visits by the Minister of Aviation, Festus Keyamo, the airline is yet to agree on resuming flights to Nigeria. “Yes, the trapped funds issue seems deadlocked,” said a source.

Similarly, other airlines are increasingly restless over their trapped funds, threatening to call it quits in Nigeria as the funds keep increasing.

“It is not a fair competition. My airline flies to Nigeria and our revenue is trapped. A Nigerian airline flies to our base country and they get their monies. Where is the fair competition?,” another foreign airline representative said. Aviation analyst, Group Capt. John Ojikutu, said aviation agencies would lose 80 per cent of their revenues if foreign airlines should leave in protest.

He said, “80% of our earnings in commercial aviation will be gone if the foreign airlines carry out their threats to withdraw their operations in Nigeria.

“Whoever knows Keyamo should tell him now. Whoever knows Tinubu should tell him now too to tell Keyamo to find out what happened to the forex earnings ($2.5bn) that the Nigeria Aviation service providers collected from the foreign airlines annually? This is not a joking matter like the palliatives and the subsidies.”

The General Secretary of the Aviation Roundtable and Safety Initiative (ART), Mr Olumide Ohunayo, decried a situation where foreign airlines pay for services in Nigeria in dollars, yet they cannot get dollars to repatriate their funds.

According to him, if the foreign airlines should leave as being threatened, Nigerian airlines cannot fill the vacuum.

More so he advised that Nigeria should take advantage of the reciprocity in the Bilateral Air Service Agreement (BASA) to begin to operate some of those routes operated by foreign airlines.

He said, “The truth is that our airlines cannot fill the vacuum, that’s almost impossible, as much as I would not advocate for us to increase their frequencies, I think it’s time for us to start using those frequencies that are ours by virtue of the reciprocity in the bilateral service agreement we have with different counties.

Source: All Africa.

Kenyan Caravan operators’ source electric powertrains.

Safarilink and Yellow Wings are excited about the potential to transform regional aviation within Kenya and East Africa by demonstrating the viability and impact that electrified Caravans will have on the industry.

Safarilink, an airline connecting domestic scheduled flights to destinations within Kenya and Tanzania, and Yellow Wings Air Services, a Kenyan air operator that serves over 500 airfields throughout the East Africa region, are to upgrade their Cessna Grand Caravan aircraft with Surf Air Mobility’s proprietary electrified powertrain technology, once certified.

The two companies are pioneering the adoption of technologies necessary for a greener and quieter (crucial for Kenyan wildlife) future in transportation, and the agreement also aligns with the Kenyan government’s recent announcement to completely move away from fossil fuels and toward renewable energy sources by 2030. Both Safarilink and Yellow Wings are already focused on sustainability and wildlife conservation efforts, however the companies believe.

the move to electrified aircraft will drive sustainability even further while setting the stage for global transformation.

“We at Safarilink are committed to doing everything possible to preserve the natural beauty of the countries we operate in,” says CEO Alex Avedi. “Implementing Surf Air Mobility’s electric powertrain technology will help us reduce the noise and minimize the climate impact of our flights as we help people from all over the world to experience our region’s incredible ecosystem.”

“We strongly believe in alternative propulsion for air travel. We have always been the frontrunners in adopting new systems and innovations. Kenya, with 91 per cent carbon free power generation, is the ideal country to spearhead this movement,” adds Yellow Wings CEO Christian Strebel.

This partnership marks another milestone as Surf Air Mobility seeks to expand its global footprint. As the exclusive partner to Textron to electrify the Caravan, it is focused on building its business in regions around the world, such as Africa, that are already significant markets for that airframe and where transportation providers are quickly adopting innovative mobility solutions.

Surf Air is developing the supplemental type certification for both hybrid and fully electric variants of the Cessna Grand Caravan.

“The Caravan is an amazing aircraft on which to develop our electrified powertrain, and we believe Safarilink’s and Yellow Wings’ operations are perfectly suited to demonstrate the benefits of our technology,” says CEO Stan Little. “We believe Africa is at the cutting edge of regional air mobility. Surf Air is excited to work with innovative, pioneering companies like Safarilink and Yellow Wings.”

“Our goal is to deploy our proprietary electrification technology on a global scale, in addition to our own network,” adds Fred Reid, global head of business development. “Upgrading Safarilink’s unlocklow Wings’ Caravan fleet with our electrified powertrains unlocks new possibilities. As air travel economics change with electrification, we believe Safarilink and Yellow Wings can improve current services, launch new viable routes and reduce environmental impact.”

 Source: ATTA Travel.

IATA: Airlines to soar with $25.7bn net profit in 2024 despite challenges.

The International Air Transport Association (IATA) has revealed a positive outlook for the airline industry, projecting improved profitability in 2023 and stabilisation in 2024. However, concerns arise as global net profitability is expected to fall significantly below the cost of capital in both years, revealing substantial regional variations in financial performance.

2024 outlook highlights

In 2024, net profits for the aviation industry are forecasted to reach $25.7 billion, a marginal improvement from the projected $23.3 billion in 2023, resulting in net profit margins of 2.7% and 2.6%, respectively.

Return on invested capital is expected to lag behind the cost of capital by 4 percentage points in both 2023 and 2024, primarily due to a global increase in interest rates driven by heightened inflationary pressures.

Operating profits for the airline industry are on an upward trajectory, projected to rise from $40.7 billion in 2023 to $49.3 billion in 2024. Total revenues are anticipated to experience robust year-over-year growth of 7.6%, reaching a historic high of $964 billion. On the expense side, projected growth is slightly lower at 6.9%, resulting in a total expenditure of $914 billion in 2024.

Exceptionally, 4.7 billion individuals are expected to engage in travel in 2024, surpassing the pre-pandemic level recorded in 2019. Cargo volumes are predicted to increase, reaching 58 million tonnes in 2023 and rising to 61 million tonnes in 2024.

Willie Walsh, Iata’s director general, acknowledges the industry’s resilience, stating, “Considering the major losses of recent years, the $25.7bn net profit expected in 2024 is a tribute to aviation’s resilience.” He underscores that the recovery has come at the cost of about four years of growth.

Revenue and passenger trends

Industry revenues are expected to reach $964bn in 2024, with an inventory of 40.1 million flights, exceeding the 2019 level of 38.9 million. Passenger revenues are set to reach $717bn in 2024, reflecting a 12% increase from $642bn in 2023. Passenger yields are expected to improve by 1.8% compared to 2023, driven by high demand and limited capacity due to persistent supply chain issues.

Efficiency levels remain high, with the load factor expected to be 82.6% in 2024, slightly better than 2023 (82%) and consistent with 2019.

Cargo and expenses

Cargo revenues are projected to fall to $111bn in 2024, impacted by the growth of belly capacity and international trade stagnation. Yields are expected to decline by -20.9% in 2024.

Expenses are anticipated to grow to $914bn in 2024, with fuel prices averaging $113.8/barrel (jet). Airlines are expected to consume 99 billion gallons of fuel in 2024. The aviation industry is increasingly focusing on Sustainable Aviation Fuels (SAF) and carbon credits to reduce its carbon footprint.

Industry CO2 emissions in 2024 are expected to be 939 million tonnes from the consumption of 99 billion gallons of fuel. SAF production is estimated to rise to 0.53% of airlines’ total fuel consumption in 2024, adding $2.4bn to next year’s fuel bill. The Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) is estimated to incur costs of $1 billion in 2024.

Regional roundup

At the regional level, North America, Europe, and the Middle East are expected to post net profits in 2023, with Asia Pacific joining the group in 2024.

However, Latin America and Africa are expected to face challenges, remaining in the red in 2024.

Global economic factors and risks

Global economic developments, wars, supply chain issues, and regulatory risks pose potential risks to industry profitability.

The aviation industry’s recovery is commendable, says Walsh, yet challenges persist, and profitability remains below average. Addressing regulatory burdens, infrastructure costs, and supply chain challenges will be critical for sustained resilience in this vital global industry.

Source:Bizcommunity.

Ethiopian Airlines -Ethiopian Aviation University.

Ethiopian Aviation Academy (EAA) is the largest and most modern aviation academy in Africa recognized as ICAO Regional Training Center of Excellence. To train aviation professionals from classrooms to full flight simulator training, EAA offers leading industry standard training for pilots, aircraft technicians, cabin attendants and ground services staff both for initial and recurrent students. The Leadership & Career Development Center is also training thousands in Management and Leadership Skills.

Our cabin crew training simulates real-time scenarios with training aircraft designed for emergency drills and service trainings. Our pilot training school uses light aircraft for its basic training with dedicated simulators. Full flight simulators of all fleets Ethiopian operates are available for flight training. Virtual Maintenance Trainers (VMTs) and various workshops feature our aircraft maintenance training. Beyond these, our academy develops standard training packages including e-learning and virtual classroom trainings. Trainee services include a trainee’s cafeteria, dormitories, an administration complex and a plush new auditorium. The academy plans to take in 4,000 students a year in its training programs.

In line with the rapid growth of Ethiopian Airlines Group, Ethiopian Aviation Academy has been upgraded to Ethiopian Aviation University, which will enable it to provide a broader range of educational programs and increase the level of expertise in the Aviation Industry. The University has been accredited by the Ethiopian Higher Education Relevance and Quality Agency (HERQA), to offer undergraduate and graduate degree programs in various aviation and hospitality fields. 

Ethiopian Aviation University has been accredited by Ethiopian Higher Education Relevance and Quality Agency to offer undergraduate and graduate degree programs in various aviation and hospitality fields.

Currently, the University offers various aviation courses such as BSc in Aeronautical Engineering, Aviation Maintenance Engineering, Aviation Management & Operations, BA in Tourism & Hospitality Management, MSc in Data Science, MBA in Aviation Management. The University also offers Diploma and Certificate Programs in Aircraft Maintenance Technician, Pilot Training, Cabin Crew and Commercial Training, Leadership & Career Development, Catering Training in addition to ICAO and Online Courses.  Ethiopian also owns training facilities in other regional cities of the country including in Hawassa, Dire-Dawa, Bahir-Dar and Mekelle.

Here is a video from Ethiopian Aviation Academy: https://we.tl/t-6ixUCPdIHJ

Source: https://corporate.ethiopianairlines.com/eaa

UNWTO and AFCAC collaborate on air connectivity in Africa.

Towards improving connectivity and advancing seamless travel in Africa, the United Nations World Tourism Organization (UNWTO) has strengthened its partnership with the African Civil Aviation Commission (AFCAC).

The new Memorandum of Understanding signed between UNWTO and AFCAC reflects the importance of boosting cooperation between tourism and aviation to create jobs and drive inclusive growth in Africa.

This agreement is based around shared initiatives, including the promotion of sustainable tourism and the implementation of the Single African Air Transport Market (SAATM).

UNWTO has actively participated in AFCAC’s recent events, particularly the SAATM Pilot Implementation Project aiming to accelerate Africa’s interconnectivity by 2025.

Acknowledging the significance of travel facilitation, UNWTO has also commended countries, including Benin, The Gambia, Kenya, Rwanda, and Seychelles, for offering free visas to African tourists, aligning with the shared vision of increased connectivity.

Source: Guardian

Navigating the Skies: The Reality of Carbon Offsets in Air Travel

In the wake of global efforts to combat climate change, the aviation industry has faced increasing scrutiny for its environmental impact. Responsible for nearly 3% of global carbon dioxide emissions, airlines are under pressure to adopt sustainable practices. One prominent approach has been the introduction of carbon offset programs, allowing passengers to pay extra to mitigate the environmental impact of their flights. However, the question remains: Does buying carbon offsets genuinely contribute to a greener planet?

Understanding Carbon Offsets

Carbon offsets operate on the principle of mitigating climate damage caused by carbon emissions. Passengers, concerned about their flights’ carbon footprint, can opt to purchase carbon credits. Each credit represents the reduction of one tonne of carbon dioxide emissions, typically generated from verified environmental projects. When these credits are used to compensate for emissions, they are retired, becoming carbon offsets.

The Role of Airlines

Over 50 airlines, including major carriers such as Singapore Airlines, Cathay Pacific, Qatar Airways, Lufthansa, and All Nippon Airways, offer passengers the option to buy carbon offsets. Despite this widespread availability, the voluntary nature of these programs results in a notably low uptake rate. According to Air Transport Action Group Executive Director Haldane Dodd, the participation rate is typically “very low,” with fewer than 5% of passengers choosing to offset their emissions through airlines.

Challenges in Uptake

Experts point to various reasons behind the low adoption of carbon offset schemes. The voluntary nature of these programs means passengers perceive them as an additional cost, potentially impacting travel budgets. With rising airfares and growing concerns about inflation, consumers are becoming increasingly cost-conscious. Although the pandemic has heightened awareness of green consumption, the financial considerations often outweigh the desire to offset carbon emissions.

Singapore Airlines’ Approach

Singapore Airlines, for instance, offers passengers the ability to calculate their carbon emissions and pay for offsets. Funds from these offset fees contribute to initiatives such as rainforest preservation in Indonesia, solar energy projects in India, and the distribution of clean-burning cooking stoves in rural Nepal.

While the intention behind carbon offset programs is noble, the current reality indicates a significant gap between intention and action. Addressing the low uptake of these initiatives requires a comprehensive understanding of consumer behavior, cost considerations, and effective communication about the tangible impact of offset contributions. As the aviation industry continues to grapple with its environmental responsibilities, finding ways to bridge this gap will be crucial in fostering a truly sustainable future for air travel.

Source: Airspace-Africa.