Nigeria misses out in air passenger growth projection for African nations

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Global demand to double by 2035

Growing population of the country notwithstanding, Nigeria missed out among top 10 African countries with fastest growing market for air passenger and potential growth in the next 20 years.

The International Air Transport Association (IATA) in its 20-Year Air Passenger Forecast released yesterday noted that Africa will see about 5.1 per cent of growth, but may not come from its most populated country – Nigeria.

Meanwhile, the clearing house for over 270 airlines worldwide, IATA, is expecting 7.2 billion passengers to travel in 2035, a near doubling of the 3.8 billion air travellers in 2016.

The prediction is based on a 3.7 per cent annual Compound Average Growth Rate (CAGR) noted in the release of the latest update to the association’s 20-Year Air Passenger Forecast.

The top 10 fastest-growing markets in percentage terms will be in Africa. They are: Sierra Leone, Guinea, Central African Republic, Benin, Mali, Rwanda, Togo, Uganda, Zambia and Madagascar.

Each of these markets is expected to grow by more than eight per cent each year on average over the next 20 years, doubling in size each decade.

Fillers from the Nigerian market said that the country’s absence among the top 10 might not be unconnected with the problem of low patronage facing both domestic and foreign airlines. While domestic airlines struggle to carry out scheduled operations, their foreign counterparts have either reduced frequencies or switch to aircraft of smaller seat-capacity.

Figures released by the Federal Airports Authority of Nigeria (FAAN) show that passenger movement at both local and international travel has reduced and it is projected that it would continue to drop till the middle of next year.

Total passenger traffic, which had been on decline since second quarter 2015, further shrunk by end of the year, with fourth quarter figures at 3,810,758, showing a significant 8.5 per cent reduction from 4,163,762 passengers recorded at the same period of 2014.

IATA’s Director General and Chief Executive Officer (CEO), Alexandre de Juniac, said people across the world want to fly and quite important for economic growth.

He said: “People want to fly. Demand for air travel over the next two decades is set to double. Enabling people and nations to trade, explore, and share the benefits of innovation and economic prosperity makes our world a better place.”

In the new prediction, the forecast for passenger growth confirms that the biggest driver of demand will be the Asia-Pacific region.

The region is expected to be the source of more than half the new passengers over the next 20 years. China will displace the United States (U.S.) as the world’s largest aviation market (defined by traffic to, from and within the country) around 2029.

India will displace the United Kingdom (UK) for third place in 2026, while Indonesia enters the top 10 at the expense of Italy. Growth will also increasingly be driven within developing markets.

Over the past decade the developing world’s share of total passenger traffic has risen from 24 per cent to nearly 40 per cent, and this trend is set to continue.

The 20-year forecast puts forward three scenarios. The central scenario foresees a doubling of passengers with a 3.7 per cent annual CAGR. If trade liberalisation gathers pace, demand could triple the 2015 level.

Conversely, if the current trend towards trade protectionism gathers strength, growth could cool to 2.5 per cent annual CAGR, which would see passenger numbers reach 5.8 billion by 2035.

According to de Juniac, “Economic growth is the only durable solution for the world’s current economic woes. Yet we see governments raising barriers to trade rather than making it easier. If this continues in the long-term, it will mean slower growth and the world will be poorer for it.

“For aviation, the protectionist scenario could see growth slowing to as low as 2.5 per cent annually. Not only will that mean fewer new aviation jobs, it will mean that instead of 7.2 billion travelers in 2035, we will have 5.8 billion. The economic impact of that will be broad and hard-felt,” he said.

Whatever scenario is eventually realized, growth will put pressure on infrastructure that is already struggling to cope with demand.

“Runways, terminals, security and baggage systems, air traffic control, and a whole raft of other elements need to be expanded to be ready for the growing number of flyers. It cannot be done by the industry alone. Planning for change requires governments, communities and the industry working together in partnership,” said de Juniac.

The industry will also need to be able to grow sustainably. Earlier this month airlines supported the establishment of a Carbon Offset and Reduction Scheme for International Aviation (CORSIA). This landmark agreement—the first among governments to manage the emissions growth of an entire global industrial sector—aims to cap net emissions with carbon neutral growth from 2020.

“Aviation is at the forefront of industries in managing its carbon footprint. Along with offsetting emissions through CORSIA, airlines are working with partners in industry and government to advance technology, improve operations and generate more efficiency in infrastructure,” said de Juniac.

The five fastest-growing markets in terms of additional passengers per year over the forecast period will be China, with 817 million new passengers for a total of 1.3 billion; U.S., with 484 million new passengers for a total of 1.1 billion; India, with 322 million new passengers for a total of 442 million; Indonesia, with 135 million new passengers for a total of 242 million and Vietnam, with 112 million new passengers for a total of 150 million.

In terms of regional growth, routes to, from and within Asia-Pacific, will see an extra 1.8 billion annual passengers by 2035, with overall market size of 3.1 billion. Its annual average growth rate of 4.7 per cent will be the second-highest, behind the Middle East.

The North American region will grow by 2.8 per cent annually and in 2035 will carry a total of 1.3 billion passengers, an additional 536 million passengers per year.

Source: The Guardian 

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