• August 4th, 2020

Africa’s travel industry needs US$10 billion

Alexandre de Juniac, the Director General of the International Air Transport Association (IATA) is leading an urgent appeal to global financial institutions to support Africa’s travel and tourism industry. Speaking from IATA’s head office in Geneva, Switzerland, De Juniac said the industry has been decimated by Covid-19 and its associated travel restrictions. 

“The industry, which supports millions of livelihoods, contributed US$169 billion to Africa’s economy, representing 7.1% of its GDP, desperately requires about US$10 billion in the way of relief. This could be in the form of grants, waivers and deferrals of taxes as well as the extension and issuing of loans to airlines and all of the other players in the sector, right down to micro enterprises like guesthouses and tour guides,” said De Juniac.  

Meanwhile, IATA joined other international air transport and tourism bodies in appealing to international financial institutions, country development partners and international donors to support Africa’s travel and tourism sector, which employs some 24.6 million people. The gist of the appeal is that without urgent funding, the Covid-19 crisis could cause a collapse of the sector in Africa, thereby jeopardising millions of jobs.

The request is being made by IATA, the World Tourism Organisation (UNWTO) of the United Nations, the World Travel and Tourism Council (WTTC), the African Airlines Association (AFRAA) and the Airlines Association of Southern Africa (AASA).  

These organisations are jointly calling on support for the Africa’s travel and tourism operators by providing, US$10 billion in relief to support the travel and tourism industry and help protect the livelihoods of those it supports directly and indirectly, access to as much grant-type financing and cash flow assistance as possible to inject liquidity and provide targeted support to severely impacted countries, financial measures that can help minimise disruptions to much-needed credit and liquidity for businesses (this includes the deferral of existing financial obligations or loan repayments), and ensuring that all funds flow down immediately to save the businesses that need them urgently, with minimal application processes and without impediments from normal lending considerations such as creditworthiness. 

While some African governments are trying to provide targeted and temporary support for hard-hit sectors, such as travel and tourism, many countries lack the necessary resources to help the industry and the livelihoods it supports through this crisis.   

However, IATA and others caution that the situation is now critical as airlines, hotels, guesthouses, lodges, restaurants, meeting venues and related-businesses face mounting losses. Typically, tourism is comprised of 80 percent of small and medium-sized enterprises (SMEs), many of whom have already begun laying off or placing staff on unpaid leave to preserve cash. 

“Airlines are at the core of the Travel and Tourism value chain that has created quality jobs for 24.6 million people in Africa. Their livelihoods are at risk. Containing the pandemic is the top priority. However, without a lifeline of funding to keep the travel & tourism sector alive, the economic devastation of Covid-19 could take Africa’s development back a decade or more. Financial relief today is a critical investment in Africa’s post-pandemic future for millions of Africans,” De Juniac added. 

“The impact of the Covid-19 pandemic is being felt across the whole tourism value chain. The sector and the millions of livelihoods it supports across the world, including vulnerable communities are particularly exposed. International financial support is key to ensuring that tourism can lead to wider economic and social recovery in these communities,” said UNWTO Secretary General Zurab Pololikashvili. 

“The travel and tourism sector is in a fight for survival, with over 100 million jobs losses globally and nearly eight million in Africa alone due to the Covid-19 crisis. Travel and Tourism is the backbone of many economies across Africa and its collapse will lead to hundreds of millions of livelihoods being impacted and enormous financial pressure for years to come. Now, more than ever, it is vital that governments work together on a global coordinated approach towards a swift recovery and ongoing support for travel & tourism. It is critical that the most vulnerable communities receive international help. The speed and strength with which the international community comes together and responds through international financial institutions, country development partners and international donors will be paramount to provide support to the many millions of people whose livelihoods are heavily dependent on our sector,” added Gloria Guevara, WTTC president and CEO. 

 “Air transport and tourism industries are among the worst impacted by the Covid-19 pandemic. Air transport is critical for the economic development and integration of the African continent. As such, support to the airline industry will aid in a faster economic recovery. An end of operations by African airlines would trigger a host of serious financial consequences, while replacing the air service provided by the airlines would be a challenging and costly process. Urgent, immediate and consistent measures need to be taken for the survival and rebound of the industry,” said AFRAA Secretary General, Abdérahmane Berthé.     

“The impact of Covid-19 in Africa continues to be brutal. Air travel and tourism have essentially shut down. Now, more than ever, international countries need to come together to help those communities that are most vulnerable. The survival of our industry and its allied sectors has serious ramifications for Africa’s entire air transport system,” stated AASA CEO Chris 

Edgar Brandt
2020-05-08 10:10:08 | 2 months ago

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