The impact of the coronavirus pandemic on the South African airline industry could amount to 10.7 million fewer passengers transported and a loss of about R40 billion ($2.29 billion), according to the latest projections by the International Air Transport Association (Iata).
Iata made the projections presuming the coronavirus restrictions are not prolonged and airlines are allowed to start flying again.
Iata estimates that every job created in the aviation industry supports another 24 jobs in the wider economy. Based on this estimate, the industry body believes 186 850 jobs could be at risk in SA, and the industry’s contribution to the SA economy could plummet by about R68.4 billion ($3.8 billion).
At this stage, Iata foresees revenue losses of 32% ($4 billion) by African airlines, and has sent out an urgent appeal to African governments to take action and provide financial relief to airlines.
According to Muhammad Albakri, Iata’s regional vice president for Africa & Middle East, many governments in the region have committed to provide relief from the effect of Covid-19, but more help is needed.
Iata is calling for a mixture of direct financial support, loans, loan guarantees and support for the corporate bond market and tax relief. “The air transport industry is an economic engine. Airlines are fighting for survival in every corner of the world. Travel restrictions and evaporating demand mean that, aside from cargo, there is almost no passenger business,” Albakri warned.