IATA Urges South Africa to Take Measures to Bolster Air Transport Sector

IATA has praised South Africa for its strategic focus on tourism as a key driver in the nation’s New Growth Path plan, but urged the use of joined-up policy thinking and to take key measures to bolster its air transport sector to achieve the 235,000 new tourism jobs that the government is targeting by 2020.

“The optimism is clear. South Africa has joined the BRICS nations and will play a key role in linking Africa to these other fast growing economies. Air transport will play an important role, bringing in tourists and facilitating trade. A coordinated policy effort to improve competitiveness is needed,” said Giovanni Bisignani, IATA’s Director General and CEO.

 A World Economic Forum index on competitiveness noted that the complexity of South Africa’s import/export procedures can be a bottleneck to trade. The introduction of electronic shipping and customs documentation through IATA e-freight will help speed the process. Johannesburg went live with e-freight from November 2010 and Cape Town began e-freight shipments in March this year. In total, IATA’s Simplifying the Business program is designed to save $4.9 billion annually across the global air cargo supply chain.

IATA also urged a review of South Africa’s economic regulation of air transport infrastructure. The regulatory process is allowing Airports Company South Africa (ACSA) to raise its charges by 129% for the 2010-2015 period and for Air Traffic and Navigation Services (ATNS) to raise its charges by 71% over the same period.

“South Africa has developed good infrastructure, but it is part of a value chain that needs to be cost efficient to be competitive. Allowing increases of 129% and 71% completely misses the mark. Johannesburg, the country’s main gateway, now ranks among the most expensive for airports of its size. Airlines are being made to foot the bill for poor performance and an airport in Durban that we did not need. This is no way to build a more successful tourism industry. We need some joined-up policy thinking,” said Bisignani.

IATA also took aim at the proposed inclusion of aviation in South Africa’s carbon tax scheme. Aviation is committed to the most aggressive climate change targets of any global industry: to improve fuel efficiency by 1.5% annually to 2020, to cap net emissions from 2020 with carbon-neutral growth, and to cut emissions in half by 2050 compared to 2005. Air transport is also the only global sector where governments have a global agreement on emissions management. This was achieved in 2010 through the International Civil Aviation Organization (ICAO) in line with the provisions of the Kyoto Protocol.

“South Africa is absolutely correct in strongly opposing Europe’s plans to include aviation in its emissions trading scheme from next year. It is illegal and it will introduce strong market distortions, particularly for long-haul destinations. So it is difficult to understand why South Africa is now considering inclusion of aviation in its own unilateral carbon tax scheme. This must be stopped. As host of COP 17 later this year, South Africa must show leadership to achieve a global approach on mitigating climate change. Taxing aviation is a step in the wrong direction for an industry that was commended by United Nations Secretary General Ban Ki-moon as a role model,” said Bisignani.

Finally, Bisignani noted that African safety remains an issue with a 2010 accident rate that is 12 times the global average. “Aviation must be safe everywhere. Africa cannot be the exception. The IATA Operational Safety Audit (IOSA) is a condition of IATA membership and is making a difference. The 22 sub-Saharan African carriers on the registry outperformed the rest of the industry. I urge South Africa to take a leadership role in the region and promote IOSA as a tool for governments to use to supplement their safety oversight and improve the region’s performance. For aviation to deliver its enormous economic benefits, the first priority is safety,” said Bisignani.

“South Africa has all the building blocks to be a great tourism nation. But that will not happen by chance. Joined-up policy thinking is needed to support it with competitive infrastructure, an approach to climate change that is aligned with the industry’s global commitments, and a safety record across Africa that is world standard. These are tough challenges. But with joined-up policy thinking, great results are possible,” Bisignani added.

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