Investing in Africa’s Aviation Infrastructure Improvement

Infrastructure reduces the costs of doing business and enables people to access markets more easily. Regarding Africa’s aviation industry generally, and Business Aviation industry specifically, infrastructure lags behind other developing regions like Latin America. But what can be done to address this?

Modernizing infrastructure and operations requires both investment and expertise, ideally from Public-Private Partnerships (PPPs), according to Professor Eyden Samunderu, Managing Partner at AMENA Africa and Air Transport Researcher at the International School of Management (ISM), in Dortmund, Germany.

“Africa needs to open its doors for private capital investment,” he argues. “Countries such as Côte d’Ivoire and Rwanda are heeding this call and making strategic bets in the sector while employing best practices to drive vibrant aviation growth.

“Therefore, injecting capital to support Africa’s aviation ecosystem will deliver improved operational efficiency of modern airports with new technology functions, increased traffic flows and passenger numbers.”

A UAS Africa spokesperson reckons that PPPs have gained traction in most infrastructure investments of such great magnitude. “While governments own the land, identify areas for construction of airports, and construct the basics (runways, apron, terminal buildings, etc.), private companies should come in and invest in facilities such as FBOs, MRO centers, and private lounges. This way, there is ownership of the project and enthusiasm in attracting customers.”

Henri Al Helaly, COO of Skytex Aero, a Morocco-based aviation maintenance solutions provider agrees that a balanced approach is key. “The public sector should facilitate and create conducive environments for investments, while the private sector can bring in capital and innovation.”

Potential challenges may block investment in the region, such as bureaucracy in many of Africa’s government departments which makes the process of pushing through funding and getting certain approvals slow. This discourages some active and potential investors, according to the UAS spokesperson.

“Large infrastructural projects require legislation which in some countries, depends on the political climate and dispensation. Where governments are not stable, investors may pull out and new ones will be discouraged.”

Al Helaly concurs that political instability, bureaucratic hurdles, and lack of clear regulatory frameworks are significant barriers. “Ensuring stability and creating transparent policies are crucial steps toward attracting investments.”

For Samunderu – who recently published research outlining how successful PPPs are based on attractive assets, clearly defined concessions, and a sound business plan – it is imperative to note that the lack of investment has stifled any promise of full growth to drive Africa’s air transport sector development. “For decades Africa has suffered from this lack of investment, strategic vision, and tactical mismanagement, which has subsequently led to a decaying of infrastructure, outdated equipment and unsafe systems on the ground and the air,” he argues.

Ongoing and Future Projects

Since there is no one-size-fits-all option for financing, designing bespoke models to cater to the African market may prove to be an effective way to leverage the private sector to improve airport infrastructure development.

Not every one of Africa’s 54 nations needs the same investment and focus. But according to UAS Africa’s estimations, 70% of African countries do require some investment in their aviation infrastructure. “Runways are short and terminal buildings are not adequate...

“Runways provide a limitation to the type of aircraft that can land, and investors in the sector are not keen to set up high-quality handling facilities where there are not enough flights.”

Al Helaly specifically highlights Central Africa as being in need of aviation infrastructure investment. “Countries like the Democratic Republic of the Congo and Chad have vast potential that can be unlocked with better connectivity,” he suggests.

Ongoing Infrastructure Projects Offer Good News

Today’s market shows that it is currently very expensive to fly within Africa due to poor connectivity. Yet there’s some good news for the local ecosystem, with ongoing and future projects to increase connectivity by creating busy hubs and attracting large carriers to these destinations, which ultimately will also benefit Business and General Aviation, too.

“The airports are planned with long runways and large terminals that will accommodate thousands of transit passengers. The new airports aim to make it attractive to fly within and through African cities,” the UAS Africa spokesperson highlights.

“These projects will enhance connectivity, reduce travel times, and improve the overall efficiency of aviation operations,” Al Helaly predicts. “The improved infrastructure will also attract foreign investments, boosting the economy.”

Leveraging private sector engagement to foster airport infrastructure improvement is therefore instrumental for enabling Africa’s economic progress. While PPPs are an investment opportunity for the private sector, however, air traffic must be above certain thresholds for governments to fund the necessary airport infrastructure projects.

More information from:
AMENA Africa: https://amena-africa.com
Skytex Aero: www.skytexaero.com
UAS Africa: www.uas.aero/tag/africa