According to the International Air Transport Association (IATA), aviation contributes to 2.6 % of Africa’s GDP and supports an estimated 6.2 million jobs. The aviation sector is one of the worse impacted during this crisis.
The COVID-19 crisis has indeed caused border closures and country lockdowns that have forced airlines to ground their fleets and stop all but essential flights such as humanitarian aid, cargo and repatriation flights for citizens stranded abroad. The regional situation in Africa does not differ from the situation worldwide. The main question on everybody’s lips is whether African aviation will survive this unprecedented shock, given that for African economies to recover, a vibrant aviation industry will be critical given the sector’s significant role in social and economic development.
Advertisement In South Africa alone, SA Express, a domestic and regional airline owned by the South African state, has been pushed over the cliff, having been declared on provisional liquidation on 30 April 2020, one month after suspending all operations. Further, after over seventy years of profits, Comair, the Johannesburg Stock Exchange (JSE) listed operator which owns Kulula and has the operating licence for British Airways, resolved on 4 May to commence with voluntary business rescue proceedings and applied to the JSE for the suspension of trading in the company’s shares. However, the UASA trade union has recently warned of possibility of legal action against Comair, stating that its members had not been told of the business rescue plan, nor how it would affect them. Last but not least, South African Airlines (SAA), the state owned flagship airline, is in business restructuring since December 2019, and after a request for Rand 10 billion was rejected by the government on 10 April, the business rescue practitioners indicated they are not able to run the airline post 8 May, after which all operations would cease. As of May 12th, SAA still had some operations running. There is some contention between the government and the business rescue practitioners, as the government’s objective was a business rescue and not a wind-down process. In this context, Mr Pravin Gordhan, the Minister for Public Enterprises, indicated to a Parliamentary committee that meetings over finances were due to take place in order to give continuity to SAA beyond 8 May, and that a new airline to replace SAA was in the planning stage. In addition, on 8 May, the Labour Court ruled that the retrenchment […]
