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Privatising airports no magic solution – aviation CEO

Jun 05 2019 22:08
Carin Smith

Privatising airports due to lack of funds for infrastructure development is not a “magic solution” for African governments, Alexandre de Juniac, CEO of the International Air Transport Association (Iata) said.

Governments in Africa should be careful before they just "rush into" privatising airports, he told Fin24 on the sidelines of Iata’s 75th annual general meeting in Seoul, South Korea, on Monday.

"We encourage governments to consider all options before they make a decision on whether to privatise an airport or not," he said. Iata has guidelines available on how it suggests governments should proceed when considering the privatisation of airports or not.

Many bad experiences, few good ones

"We have seen so many bad experiences when airports have been privatised and only a few good ones," said De Juniac.

"We understand that many governments in Africa would go for the privatisation option, because of lack of funds, but we are simply saying they should be careful."

Another focus point for Iata in Africa is to continue to encourage governments to forge ahead with the implementation of the Single African Air Transport Market (SAATM).

The process has been slow.

Threat? 

According to De Juniac, the lack of progress has mainly been due to political reasons as SAATM touches the sovereignty of countries. The reluctance also relates to economic reasons as some governments want to protect their own airlines from what they perceive as a threat from other airlines.

"Some think it will kill their initiative to build up their own national carriers," said De Juniac.

"Iata will continue to push harder for SAATM. We think any initiative favourable to opening the skies in Africa is generally favourable for airlines as it expands traffic, which in turn  brings gross domestic product (GDP) growth, jobs, and prosperity."

Iata is busy with a study on the value of open skies in aviation in Africa and the benefits of increased intra-African connectivity.

"The reluctance to implement SAATM or not is mostly based on the political situation in each country. We saw the same type of thing in Europe initially regarding open skies there," said De Juniac.

* Fin24 is a guest of Iata at its AGM.

iata  |  iata agm  |  africa  |  privatisation  |  aviation  |  airports
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