African Airlines Soar: A Comprehensive Look at Performance and Industry Dynamics in August 2023

In August 2023, the African aviation industry is demonstrating remarkable resilience and growth, with traffic carried by African airlines reaching an impressive 98.4% of the 2019 levels. This resurgence is underpinned by various factors and industry dynamics that highlight the promising prospects for African aviation.

Recovery Trends: Almost Back to Pre-Pandemic Levels

One of the most encouraging trends in the African aviation industry is the near-complete recovery to 2019 traffic levels. This signifies a significant milestone, with domestic, intra-Africa, and intercontinental market shares estimated at 34%, 29%, and 37%, respectively. It’s a testament to the industry’s resilience and adaptability in the face of unprecedented challenges.

African airlines have not only rebounded but are also expanding their horizons. The total number of intercontinental routes operated by African airlines has surpassed pre-COVID levels since October 2022. In major airports like Johannesburg, Nairobi, Addis Ababa, Lusaka, Cairo, Casablanca, Abidjan, and Lomé, intra-Africa connectivity reached or exceeded pre-COVID levels since December 2022. This expansion showcases the industry’s determination to provide extensive connectivity across the continent and beyond.

Financial Outlook: Narrowing the Revenue Gap

The financial outlook for African airlines in 2023 is looking brighter. In the first three months of the year, African airlines missed 2019 revenue levels by just $0.3 billion. According to AFRAA data, this gap is expected to further narrow in the second quarter to $0.2 billion for the quarter. While the full-year estimated revenue gap is yet to be computed, it appears that 2023 will be a significantly better year compared to the challenging year of 2022, when the cumulative revenue gap was $3.5 billion for all African airlines compared to 2019.

Despite the positive performance, African airlines are grappling with rising Jet A1 fuel prices. The global weekly average jet fuel price during the week ending August 25 surged by 2.9%, reaching $126.37 per barrel. This steep increase, up from an average of $103.64 per barrel in July, presents a new challenge for airlines in maintaining profitability.

A persistent issue faced by the industry is blocked funds, which reduced slightly in July to $2.200 billion compared to $2.274 billion in June. A significant portion of these blocked funds are in Africa, with 14 countries accounting for about 70% of the total. AFRAA is actively engaging with central bank Governors to find a solution to this problem and have the funds released, ensuring that airlines can access the capital they need to operate effectively.

Full recovery to pre-pandemic levels for passenger traffic is now expected to occur in 2024, but economic performance in the region will continue to suffer as long as Africa’s internal market remains constrained.

Even before the pandemic, airlines in the region struggled to make a profit due to structural impediments.

COVID-19 has not made these better, although African states are starting to come around to the benefits of air services liberalization and improving flows of passengers and cargo.

Air transport has an important role to play in the wider recovery of African economies in the post-COVID-19 period. However, the continent’s fractured skies will remain a brake on recovery and a challenge to industry growth

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Victor Shalton

Victor Shalton's love for aviation can be traced to when he was 11-years-old. As a seasoned aviation writer, he takes pride in providing the best aviation coverage around the globe and is passionate about advancing his skills in the aviation space. In addition, he loves travelling, writing, arts and while his speaking engagements have taken him around the world, he is proud to call Nairobi home.

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