the global air transport industry...over the next 20 years 2.0x the number of air passenger journeys...
TRANSCRIPT
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The global air transport industry:
1 Source: IATA www.iata.org/economics
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The global industry outlook remains bright…
2 www.iata.org/economics Source: IATA/Tourism Economics
3.5% Average annual growth in global air passenger journeys over the next 20 years
2.0x The number of air passenger journeys in 2037 compared with today
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20-year air passenger growth is shifting East & South
Source: IATA/Tourism Economics 3 www.iata.org/economics
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In Africa, air transport supports…
4
…6.2 million jobs & $55.8 billion of GDP
Source: ATAG www.iata.org/economics
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Demand for air travel in Africa to soar in the middle run
Source: IATA/Oxford Economics www.iata.org/economics 5
334
135
100
150
200
250
300
350
400
2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 2037
No Policy Change
Policy Stimulus & Market Liberalisation
Pick-up in Protectionism
million passengers per year (O-D basis)
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6 Source: ATAG www.iata.org/economics
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20-year passenger growth outlook (2017-37)
7 Source: IATA/Tourism Economics www.iata.org/economics
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The markets of tomorrow
Source: IATA/Tourism Economics www.iata.org/economics 8
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Top 10 air markets in Africa shows few changes
9 www.iata.org/economics Source: IATA/Oxford Economics
1
2
3
4
5
6
7
8
9
10
2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 2037
Egypt
S. Africa
Tanzania
Mauritius
Ethiopia
Kenya
Tunisia
Nigeria
Algeria
Morocco
Egypt
Nigeria
Algeria
Kenya
Ethiopia
Tanzania
Tunisia
Morocco
Sudan
S. Africa
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Drivers of demand for air travel in Africa: Population
10 www.iata.org/economics Source: IATA/Oxford Economics
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037
African Population in Million
Total population evolution: Africa
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Drivers of demand for air travel in Africa: Income
11 www.iata.org/economics Source: IATA/Oxford Economics
0
500
1,000
1,500
2,000
2,500
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037
African per Capita GDP in Real USD
Per capita GDP evolution: Africa
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Strong increase in # of passengers over next 20 years
12 www.iata.org/economics Source: IATA/Oxford Economics
0 10,000 20,000 30,000 40,000 50,000 60,000
Egypt
Morocco
Ethiopia
Kenya
Nigeria
South…
Tanzania
Number of passengers per year (‘000)
Number of passengers in African countries with strong airline industry
2017
2037
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… translating into high annual passenger growth rate
13 www.iata.org/economics Source: IATA/Oxford Economics
3.7
2.3
6.4 6.2
5.4
3.8
6.3
4.6
1
2
3
4
5
6
7
Compound annual growth rate (CAGR) for passengers
Passenger average yearly growth rate for period 2017-2037
Egypt Morocco Ethiopia Kenya Nigeria South Africa Tanzania Africa
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Visa openness index 2018
Source: UNWTO www.iata.org/economics 14
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Air travel connectivity from Africa to the World: 2008
15 www.iata.org/economics Source: SRS Analyser
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Air travel connectivity from Africa to the World: 2018
16 www.iata.org/economics Source: SRS Analyser
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Air travel connectivity within Africa: 2008
17 www.iata.org/economics Source: SRS Analyser
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Air travel connectivity within Africa: 2018
18 www.iata.org/economics Source: SRS Analyser
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Source: IATA Economics using data from ICAO, The Airline Analyst, IATA forecasts
Regional profitability remains very uneven
-6%
-1%
4%
9%
N America Europe Asia Pacific Middle East L America Africa
Net post-tax profit margins
2015 2016 2017 2018
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Regional (net) profitability – Africa
www.iata.org/economics 20 Source: IATA
-8%
-6%
-4%
-2%
0%
2%
-2.0
-1.5
-1.0
-0.5
0.0
0.5
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018f
Net profit (Left axis)
US$bn
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Airline Cost Drivers in Africa
-6% -4% -2% 0% 2% 4% 6%
Station expenses
Flight crew salaries and expenses
Passenger services
Other expenses (flight operations)
Depreciation and amortization
Flight equipment insurance
Other operating expenses
Flight equipment rentals
Ticketing, sales and promotion
Aircraft fuel and oil
Flight equipment maintenance and overhaul
User charges
Percentage points difference in shares of total regional costs.
Differences in cost sources: Africa vs Industry
The 0% line indicates the industry average.
Lower than industry average
Higher than industry average
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How IATA initiatives impact cost-drivers in Africa
-6% -4% -2% 0% 2% 4% 6%
Station expenses
Flight crew salaries and expenses
Passenger services
Other expenses (flight operations)
Depreciation and amortization
Flight equipment insurance
Other operating expenses
Flight equipment rentals
Ticketing, sales and promotion
Aircraft fuel and oil
Flight equipment maintenance and overhaul
User charges
Percentage points difference in shares of total regional costs.
Differences in cost sources: Africa vs Industry
The 0% line indicates the industry average.
Lower than industry
Higher than industry average
ASA best practice clauses
Airport Privatization Efforts
Standards & initiatives related to distribution issues
Smarter Regulation
Advocacy