The Secretary General of the East African Community (EAC), Peter Mathuki, has urged African leaders to urgently implement the Single African Air Transport Market (SAATM) agreement, which will lower the cost of air transport in Africa and in turn boost development.
He said this on Monday, February 28, at the beginning of the Programme for Infrastructure Development in Africa (PIDA) week in the Kenyan capital Nairobi.
The SAATM is a project of the African Union to create a single market for air transport in Africa. Once fully in force, it is supposed to allow significant freedom of air transport in Africa, advancing the AU's Agenda 2063.
Mathuki stated that air cargo currently accounts for only 2% of the global air cargo and air transport remains out of reach for both passenger and cargo haulage due to high associated costs.
"These costs can be brought down if we have political commitment to implement the Single African Air Transport Market (SAATM) agreement,” Mathuki said.
The PIDA Week aims at bringing together international and regional expertise from multiple stakeholders to deliberate on the issues around infrastructure delivery in Africa, and those related to PIDA.
Legislators concerned
Meanwhile, members of the East African Legislative Assembly (EALA) called for relevant organs of the regional bloc to expeditiously devise strategies to reduce the cost of air transport in the region by end this year.
This is contained in a report by the House’s Committee on Accounts after it undertook oversight activities late last year, to assess, among others, the level enforcement of safety, harmonisation of civil air transport policies and civil aviation rules and regulations in the region.
"Air transport in East Africa is generally expensive by international standards going by the current high passenger air fares and flight charges. The expensive rates on both passenger and cargo flights contribute to the high cost of doing business in the region,” reads part of the Committee’s report.
The report is among the vital items on the order paper that could not be tabled Thursday as lawmakers decided that they would not proceed in the absence of Ministers in charge of EAC Affairs – and nothing would eventually be implemented.
"For instance, a passenger airline ticket between Entebbe and Nairobi costs $380 on average while that between Nairobi and Dar es Salaam is between $350 and $400 for economy class,” reads the report.
"It is estimated that 43 per cent of air ticket prices in EAC comprise of regulatory charges and taxes, landing and parking rates, with regulatory fees accounting for up to 24 per cent.”
The average amount of taxes and fees paid in Africa by passengers is $64.
In Europe, passengers are charged $30.23 while in the Middle East, they are charged $29.65 in spite of the fact that air traffic is much more significant in these regions.
In the EAC, the charges vary. In Burundi total passenger charges are $60 while they stand at $50 in both Rwanda and Kenya, and $54 and $57 in Tanzania and Uganda, respectively.
In June last year, regional Ministers in charge of transport, communication and meteorology directed Partner States to harmonise their air travel policies, examine factors that determine air ticket costs and develop uniform air travel regulation.
Partners States are yet to conclude on harmonisation their air travel policies.
Asked about what he thinks the six-member EAC can do to significantly cut air transport costs, Rwandan economist John Bosco Kalisa, CEO of the six-member bloc’s top regional body of private sector associations and corporates, painted an optimistic picture.
Kalisa said: "Yes, the strategy is simple. It is to harmonise and reduce charges and taxes they impose on our regional airlines.
"Once these charges are reduced, it will be cheaper and affordable for East African citizens to fly and enjoy the beauties of their countries.”
Harmonize charges
The Committee observed that most EAC countries have huge variations on air navigation charges and these have a huge bearing on the cost of travel.
Air navigation service charges are levied on air operators to cater for enroute, approach and in terminal area costs.
The Committee noted that for instance, a flight operated in a B737- 800 with a maximum takeoff weight (MTOW) of 70 tons, operating a distance of 1000 nm (1852 km), enroute charges will be; $53 for Burundi, $219.71 in Kenya, $100 in Rwanda, $140 (depending on flights per day) in Tanzania and $125 in Uganda.
Coupled with this, other airport fees include payment for other services like; landing, noise, parking, flight information dispaly systems, passenger bus, lightning and several others.
Lawmakers observe that "all these charges increase the cost of air travel.”
Once the report is eventually tabled, the committee will recommend to the Assembly to urge the Council of Ministers to, as "a matter of priority” ensure the review and harmonisation of charging mechanisms, fees and taxes with the objective to reduce the ticket cost and stimulate demand in travel by air.
They will call for the harmonization of tax regimes so as to avoid possible uncompetitive advantages between the routes; and call for avoiding double taxation practices as provided by the EAC agreement on double taxation, among others.
Lawmakers also want the support given to airlines in view of post Covid-19 pandemic recovery enhanced, and Covid-19 testing fees levied at various EAC airports harmonised.
"This will in turn bring more transparency and lead to a reduction to the air ticket costs for EAC Partner States.”
About five years ago, a study on the economic importance of liberalised air space indicated that airspace liberalisation between five EAC countries of Rwanda, Uganda, Kenya, Tanzania and Burundi an additional 46,320 jobs and $202.1 million (approx: Rwf 164.5 billion) annually in GDP.