Africa: Euro Crisis – a Threat to African Airlines

New Era

Africa: Euro Crisis led to decreasing of visitors to Africa.

The European economic crisis poses a serious threat to African airlines and is causing a dramatic decrease in the number of air passengers.

Speaking during a media briefing here on Friday, Deputy Director for Aviation, Administration and Navigation for the Namibian Civil Aviation Directorate in the Ministry of Works and Transport, Tobias Günzel, said the economic crisis in Europe affects air transport and passengers are holding back their money.

Gunzel said Africa faces a challenge of an increase in fuel prices, adding that 40 per cent of airlines’ capital goes to fuel purchases.

Speaking at the same event, the business manager of Landover Company in Nigeria, Monday Ukoha, echoed the same sentiments, saying the smallest airline in Africa needs to benefit from the economic scale.

Landover Company is the leading aviation services provider and airline group in Africa with headquarters in Lagos, Nigeria, providing innovative and multi-disciplinary applications of aviation knowledge and logistics support to the enterprise.

“Africa and the world at large need to be innovative on how to go about it and find ways how to cooperate and support each other,” said Ukoha.

He noted that the industry also faces challenges of poor infrastructure, even though there are a few improvements, adding that there is need to tackle the issue of infrastructure in areas of public-private partnership.

Ukona indicated that these are some issues to be discussed in the upcoming 18th Aviation and Allied Business Leadership Conference scheduled to take place in Windhoek from September 02 to 04 this year.

Meanwhile, Air Namibia’s general manager for Commercial Services, Xanier Masule, said earlier in the week that since the 2008 global economic recession, the national airliner has been facing many difficulties.

Masule said the Eurozone crisis would affect the airline’s revenue, as more than 55 per cent of its revenue is derived from the European market.

He added that other challenges that may affect the attainment of set targets could be the rising of oil prices in 2011/2012, which harm their productivity.

Masule said Air Namibia is currently working towards an updated business plan that was approved by Cabinet last year.

He said the new business plan is aimed at improving competitiveness and growth of the company, adding that Air Namibia plans to make profit of more than N$1.8 billion in the next four years.

The European sovereign debt crisis has been an ongoing financial crisis that has made it difficult or impossible for some countries in the euro area to re-finance their government debt without the assistance of third parties.

Nampa

Posted by admin on Jun 27 2012. Filed under African News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry