spreading the load –cargo market potential for african freight · 2020-03-18 · –representing...

www.tiaca.org – Representing all parts of the supply chain

Spreading the Load – Cargo Market Potential for African Freight

Sanjeev S GadhiaVice Chairman, TIACA

Vice Chairman – AFRAA Cargo CommitteeFounder & CEO – Astral Aviation


TIACAThe International Air Cargo Association

n International not-for-profit association representing all parts of the air cargo industry (traditional players and new entrants, small, medium and large companies)n Shippersn Forwardersn GSSAsn Airportsn Airlinesn Ground handlersn Cargo dronesn Manufacturersn IT solution providersn Educational institutionsn Consulting firms

2020

focu

s

• Maintain high quality and Member satisfaction

• Have TIACA Ambassadors in all regions

• Get closer to our members by organizing regular Meetups

• Attract new entrants: start-ups, cargo drones, etc.


TIACA’s mission

nSet the vision for air cargo industry

nEducate its Members and the air cargo industry

nSupport or lead, as appropriate, necessary change in the air cargo industry

nUnite the industry with one voice on common interests

nPromote and encourage innovation


TIACA’s strategic focus

NetworkingTraining SustainabilityPartnership Outreach


Partnership: stronger together is TIACA’s philosophy

2020

focu

s

• Strengthen our existing partnership with ICAO, IATA, ACI

• Develop new partnership at regional levels and in specific areas: Sustainability, Unmanned Aviation, e-Commerce, ULD


Sustainability: set-up the urgency and accelerate progress through innovation and collaboration

n3+2: people, planet, prosperity + innovation & partnerships

nNew program launched in 2019 to drive sustainability goals within the air cargo industry

n1st Sustainability Award at the last TIACA Executive Summit in Nov 2019

n5 Strategic Partners funding the initiative: we need more!

2020

focu

s

• Launch the 1st Air Cargo Industry Sustainability Survey

• Build relevant partnerships• Unite the industry towards one

common vision for sustainable air cargo

• Reward sustainable practices with the 2nd Award


AFRAA & CARGO

Established in September 2016 in Nairobi, Kenya with members from AFRAA which are-Air Algeria; Air Zimbabwe; Astral Aviation (Vice Chairman); Champ CargoSystems (Industry Partner); Express Airlines; Egypt Air (Chairman); EthiopianAirlines; Kenya Airways; Libyan Airlines; Royal Air Maroc; Rwandair; Safe Air;South African Airlines; South African Express & Tunisair

Ø 7TH AFRAA Cargo Task Force Meeting, Cairo, 7-8 October 2019

Ø MoU with TIACA (The International Air Cargo Association) Air cargo and mail security and facilitation; replacing paper-based practices with electronic ones; environmental practices; liberalization of market access for air cargo services; air cargo safety; and modernization of all the processes of air cargo transportation.

Ø Network Coordination Meetings between AFRAA Member Airlines


ASTRAL AVIATION nAll-Cargo Airline which is based at JKIA, Nairobi and operational for 20 years.

n2019 Data > 75,815 Tons / 3,093 Flights

nSCHEDULED FREIGHTER EX NAIROBI

v Europe > London & Liege, Belgium

v Intra-Africa > Tanzania, Mozambique, Somalia, South Sudan, Djibouti, DRC.

nFleet is B747-400F (110t); B727-200F, DC9F, F27 + FlyOx (Cargo Drone)

nCo-operates with 20 Airlines including 5 African Airlines on Cargo.

nProud Member of AFRAA & TIACA

nVoted Best Cargo Carrier in Africa from 2011 - 2019


KEY STATISTICS – AFRICA AIR CARGOnAFRICA’s Share of Air Cargo is 1.8% of Global FTK (Source: IATA)

nAFRICA’s Growth in Air Cargo is the highest in the world (Source: IATA)

n FTK 7.7%

n AFTK 13.8%

nKey Trade Lanes

n China – Africa

n Europe – Africa

n Intra – Africa

nTOP African Airports (Source: ACI / As at Nov 2019)

n Nairobi 364 Tons

n Johannesburg 345 Tons

n Cairo 337 Tons

n Addis Ababa 273 Tons

n Lagos 188 Tons


2020 Outlook

n2020 will be a TOUGH year for the Air Cargo Industry in Africa due to :

nCOVID-19 (Corona Virus)

nBad Weather in Eastern Africa.

n IATA’s outlook for Africa is -0.4% in 2020 (Global -4.7% / Based on RPK) and $29b loss for

the Global Passenger airlines (-0.04 for Africa)

nDue to massive cancellation in flights and shipping originating from China in Q1/2020, African

Airlines will face significant losses despite a potential rise in yields once the flights resume.

nDue to the adverse weather conditions in Eastern Africa in Q4/2019 and Q1/2020, Perishable

Exports during the Valentines Period were affected due to limited output from the farms.

nOn a positive note, the increase in Intra-African trade will result in improved connectivity and

capacity for air-cargo which is projected to grow at 15% in 2020.


AIR CARGO IN AFRICA


5 KEY FACTS – AIR CARGO IN AFRICAØ HIGH COST

Ø Jet Fuel, Cargo Handling, Freight Tax and Royalties.

Ø REGULATIONSØ Lack of Liberalization, Restrictions on Traffic Rights, Protectionism.Ø Favouritism for Foreign Carriers Vs African Carriers.

Ø CONNECTIVITYØ Lack of Intra-African Connectivity results in air-cargoes being routed via Middle East and Europe.Ø Lack of Co-operation between African Airlines hampers connectivity.

Ø INFRASTRUCTUREØ Lack of Basic infrastructure, Terminals, Parking & Capacity for AircargoØ Encourage Private sector investments Via PPP Framework

Ø FOREIGN CARRIERSØ Lack of Co-operation with African carriers.Ø Dominates 85% of Cargo and 80% of Passenger TrafficØ Granted 5th Freedom Rights in several Key Routes


5 PRIORITIES – AIR CARGO IN AFRICAØ LIBERALIZATION of air cargo operations should be promoted through removal ofrestrictions on traffic rights and limitations on capacity in air service agreements. SAATMneeds to be implemented !!!

Ø HIGH TAXES, charges, royalties and levies on aviation should be assessed anddisclosed; and action taken to limit their adverse impact on the growth and developmentof air cargo services.

Ø African Airlines need to make genuine efforts to increase the levels of CO-OPERATIONin Air cargo with greater interline, SPA, Code-share, JV and Reciprocal GHA’s betweenthemselves

Ø Importance of INFRASTRUCTURE to support continued development of airports andintermodal transportation infrastructure to meet the demand for air cargo including PPP &JV’s

Ø AFRICAN CONTINENTAL FREE TRADE AREA (AfCFTA) implementation in July 2020will result in increase in intra-African trade which will enhance regional connectivity


CONCLUSIONv Aviation has the potential to make an important contribution to economicgrowth and development within Africa.

v LIBERALIZATION brings benefits to consumers and airlines, and results inlower tariffs and better connectivity, which in turn stimulates new andadditional traffic volumes, trade and investment, which propels economicgrowth and increase in employment.

v If African nations and airlines don’t fully embrace the SAATM for the benefitof Africa, then the continent, its people and its airlines are unlikely to reachtheir full potential.

v With the implementation of SAATM, intra-African connectivity will developand there will be more growth opportunities for African airlines. As a result,aviation’s role as an economic driver will grow significantly.

v SAATM & AfCFTA are excellent initiatives by AU, which need to be supportedwith the view of implementation within the prescribed time-lines.


Join us!

nJoin the association nownJoin the Sustainability ProgramnRegister to the 1st Airports4Cargo Conference in Brussels, 24 – 25 June 2020

nSave the date for the Air Cargo Forum in Miami, 10 – 12 November 2020

nSubscribe to our publications and social media channels

What’s in it for you?

nGrow your network and business

nLearn, get inspired

nShare, increase your visibility and reach

nInfluence, be heard

nHave fun!


TIACA’s visionTIACA’s vision for air cargo is a safe, profitable and united air cargo industry that embraces modern technologies and practices to sustainably serve global trade

and social development worldwide.

spreading the load –cargo market potential for african freight · 2020-03-18 · –representing...

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