As the COVID-19 pandemic takes its unprecedented toll on the aviation industry, Mr. Ali Tounsi, Secretary General of the Airports Council Industry Africa Region (ACI-Africa), here outlines measures to tide the airports industry over the pandemic period. He wants African airports to position an embrace the change that will emerge post-COVID-19, as he stresses the need for airlines and airports to work together. Q: How would you describe the impact of the COVID-19 Pandemic on airports, especially airports in Africa, and how has ACI-Africa participated in managing the crisis?
Q: How would you describe the impact of the COVID-19 Pandemic on airports, especially airports in Africa, and how has ACI-Africa participated in managing the crisis?
A: The impact of the COVID-19 pandemic on the aviation industry has been and will continue to be unprecedented in its magnitude and scope for the industry.
The slowdown in traffic for African airports was experienced as from mid-March, reaching an almost standstill in April and May. How the traffic will recover in Africa is still uncertain. According to the best guess, a low restart is expected in the third quarter of 2020. The anticipated drop in traffic for the first 6 months is expected to be of the order of 55% and more than 47% for the year 2020.
For the second quarter of 2020, the estimated loss of revenue for airports in Africa will be overwhelming, reaching 90% compared to revenue forecasts without the COVID-19 crisis. The loss of airport revenue for the Africa region for the year 2020 is estimated at USD 2.2 billion, a drop of more than 51% compared to the revenue forecast for this year which was around USD 4.3 billion.
Although many African airports have responded well to the challenges posed by the COVID-19 pandemic by implementing a battery of measures to prevent the entry and spread of the virus across their air borders, it is now extremely important that African airports urgently put in place an adequate operational plan to allow the smooth reopening of the air borders after the end of the lockdown.
In order to maintain close proximity with all its members during this crisis, ACI-Africa has been in constant contact with them since mid-February 2020 by providing daily updates on the situation of COVID-19 in Africa and providing guidelines and best practices in the fight against the virus.
Now is the time for the restart of the air transport industry in Africa. We cannot afford to remain in this situation any longer with many airports having already exhausted their meagre cash reserves by maintaining the airport facilities during the lockdown period and maintaining operations for cargo, humanitarian, repatriation and emergency flights despite not receiving any revenues.
The other question which begs for an answer is what will be the ‘new’ passenger experience when the air travel restarts. Obviously, it cannot and will not be the same. In this context, ACI Africa has released on 14 May 2020, comprehensive guidelines and recommendations for all African airports and we are pleased to note that many airports are now adopting these in the preparation of their restart and eventually recovery of their activities.
Q: Given that African airports have very limited non-aeronautical revenue and heavily dependent on aeronautical revenue, do you expect non-aeronautical revenue to return sooner to African airports post-COVID-19?
A: It is true that non-aeronautical revenue accounts for only 30% of the total revenue of airports in Africa, which is below the world trend at 40%. For the financial sustainability of the airport industry in Africa at the restart, there is no doubt that both aeronautical and non-aeronautical revenues are equally important in the path to recovery.
Although, we may not see a swift recovery in air traffic in the foreseeable future, some scenarios predict a return to the 2019 figures only as from 2024. Despite the slow restart to air traffic, I am confident that all airports will work closely with their concessionaires to find ways and means to sustain the financial recovery phase.
Q: How do you think African airports can return to safe, secure operation post-COVID-19 given that these airports have been mainly on lockdown except for occasional emergency operations?
A: As I said earlier, ACI Africa has already released a comprehensive guide on the restart and recovery for African airports. It is intended that these guidelines and recommendations serve as a roadmap for all African airports to prepare their new business continuity plan in the most coordinated, consistent and efficient manner. The guide is based on six key pillars which, according to ACI-Africa, are essential for restoring confidence in travellers at the African airports, namely a good preparation ; motivated staff, a healthy airport ; a healthy experience ; as well as communication and financial viability.
Besides the new health measures to be adopted and implemented at airports, the guide also covers how to return to normal after the lockdown by taking into consideration the fundamentals of aviation, which remain safety and security. Safe and secure operations at all times is a critical prerequisite for restarting the airport activities and the subsequent development of air traffic. It should therefore be ensured that any cost reduction strategy in those challenging times do not compromise those two priority pillars of aviation.
Q: There is some worry among travellers, airports and airlines concerning the globally accepted measures to be implemented at airports to prevent the spread of the COVID-19; how best should airports proceed in this regard?
A: The restart of civil aviation activities on the continent is very challenging, necessitating the implementation of a ‘new normal’, which may consist of a variety of new measures, impacting the standard and usual operations of operators and service providers in the aviation ecosystem.
The guiding principles remain the protection of the health and welfare of employees, passengers and public, minimization of the possibilities of dissemination of the virus and restoration of efficient and consistent airport experience.
New measures introduced to validate the acceptance of a passenger at departure or on arrivals must be based on scientific and medical evaluation of information, and on medical expert evidence from recognized organizations whilst limiting their potential impact on the overall passenger experience.
The ‘new’ passenger journey must as far as possible be consistent and standardized for both international and domestic travels and across airports on the continent. Where measures differ by country, good coordination and clear communication to the passengers are key to prevent confusion and frustration, and minimize the impact on passenger confidence.
Q: Do you think Airports should give African Airlines waivers or support to encourage the Airlines back into service given that airlines and aviation are one of the worst hit by the COVID-19?
A: We are all in this together! Airlines as well as airports have been severely impacted financially by the COVID-19 pandemic.
With near to zero traffic at most African airports, the main revenue source is close to nil over the last two months. This situation must therefore not be ignored as African airports are businesses in their own rights contributing significantly to the economic growth, wealth creation and employment, and must certainly not be viewed as an instrument of subsidization in a crisis situation.
ACI-Africa firmly believes that now is the time to act in unity despite our possible differences in views and opinions. In time of such crisis, all stakeholders of the aviation ecosystem must work together towards a swift, efficient and least damaging recovery for each one, without any stakeholder being favoured at the expense of another.
On the other hand, any incentive provided to airlines by airports must be on a win-win situation, i.e. consider incentive package offered by airports to airlines calculated on a proportional reduction in charges based on incremental increase in traffic.
Q: There is a fervent call by the global and African aviation community for government financial and other support to help quick recovery of the aviation industry. What do you think in this regard?
A: We have here to mention the ongoing close collaboration between ACI and IATA, speaking as a single voice, requesting States’ intervention in terms of economic policy measures to mitigate losses, restart of the aviation activities and ensuring a swift business recovery in the most sustainable manner for all the partners of the aviation industry.
Measures being contemplated include, amongst others the exemption of Value Added Tax (VAT) refunds on services, spare parts and equipment to improve cash flows;
reduction or waiving off of corporate taxes paid to the Government, albeit with a moratorium period; and deferment of loan repayment contracted from the Government and; and also need to renegotiate existing concession contracts.
Q: Do you think partnerships among African airports would help the recovery process post-COVID-19?
A: The air transport industry is a multi-stakeholder collaboration. Thus, collaboration is required at multiple levels, including among States and between State and the industry partners for a harmonized and efficient restart and recovery of the aviation sector in Africa.
Likewise, States and the aviation industry should work collaboratively to identify opportunities to increase regulatory flexibility, allow as much passenger departure formalities prior to arriving at the airport, minimize “passenger touch points”, and determine the admissibility of a departure passenger at the point of origin itself.
Collaboration will also be needed among border control agencies like health, customs, immigration, police; as well as among countries to work towards a consistent and seamless travel experience in the new normal.
Q: If there is one area of major challenge you expect or foresee in the recovery of the airports in Africa from COVID-19, what would it be, and how is ACI-Africa working to ensure quick recovery at African airports?
A: One of the biggest challenges which we are all facing, amid this COVID-19 pandemic, is the fear of the unknown in terms of when will all this be over. As at now, no one can confidently predict the future of air travel and confidently give timelines in terms of short, medium and long term recovery of air traffic.
This scenario thus makes it difficult to efficiently plan for the future. Of course, we need to start somewhere and having a restart plan is the best way to optimistically look at the future and set the base for a sustainable recovery of the air transport industry in Africa. And, this is precisely what ACI Africa has done by providing all African airports with necessary guidelines to prepare and restart the airport activities.
Q: Would you say airports operations would be permanently changed by the effects of the COVID-19 or do you see airports in Africa running as usual as before COVID-19?
A: We are all referring to a ‘new normal’ or ‘business as unusual’ since the proclamation of the COVID-19 pandemic. Yes, it will not and cannot be the same. Public health measures introduced during the COVID-19 pandemic are here to stay and even have to be reinforced, at least for some time, in order to prevent future waves of the pandemic and more importantly to restore confidence in the travelling public.
Wearing a mask, applying social distancing and regularly disinfecting our hands will become the new norms at airports on equal terms as safety and security measures. Until and unless a durable cure is found, some of these measures will have to form part of the new passenger experience.
Q: If there is one major lesson for you to learnt among African airports from the COVID-19 Pandemic, what would the lesson be?
A: To be honest, I do not think that anyone saw this crisis happening and all African airports have been caught almost unprepared as no business continuity plan ever catered for such unprecedented and catastrophic impact.
This therefore reminds us that the aviation sector is a highly volatile one and looking at the future, I sincerely believe that all airports will review their business continuity plans, especially in terms of financially sustainability in order to better prepare for a similar crisis.