AfDB to Embark Upon Developing Africa’s Air Transportation to Strengthen Regional Integration
A high-level delegation from the Brazilian Development Bank (BNDES) visited the African Development Bank Group on September 18 in Tunis to share industry knowledge and lessons learned that may help revolutionize aviation in Africa. The workshop entitled “Developing Africa’s Air Transportation” was chaired by Steve Kayizzi-Mugerwa, Director of Development Research, and Tas Anvaripour, Manager for Infrastructure Finance in the Private Sector Department of the African Development Bank. The meeting also brought together senior representatives and sponsors of major aircraft companies, including Embraer – the world’s third largest manufacturer of aircraft and the leading brand of regional jets – and Aldus Aviation – an aircraft leasing company that proposes setting up operations in Africa.
The occasion marked the first step in the implementation of an MOU of Collaboration signed by AfDB’s President Donald Kaberuka with BNDES within the context of Rio+20 last June.
Speaking on the occasion, Embraer’s Vice-President for the Middle East and Africa, Mathieu Duquesnoy, affirmed that “with only 30 per cent of Africa’s air transport routes subject to competition, the potential for growth and lower airfares across the continent is very significant. Regional aircraft can help spur competition, by adding to the competitiveness of African airlines.”
In today’s complex economy, Africa’s aviation industry is an important tool of economic development. The continent’s infrastructure challenge renders air transport a potential leapfrogging technology akin to mobile phones. Unfortunately, despite signs of vitality in the continent's economy, aviation in Africa is lagging behind. Regulatory concerns play a part, but it is in addressing the other key industry obstacle – limited access to long-term finance – that the Bank can play a more immediate role.
“Africa is the only region in the world where 70 per cent of air transportation is still served by a monopoly,” noted Duquesnoy. The technology provider proposes catalyzing change in Africa’s aviation industry through the introduction of modern, right-sized, and fuel efficient planes. According to Marcio Nobre Migon, BNDES Head of Aircraft Financing, “the adoption of regional jets was highly catalytic for the growth of aviation in Brazil and we believe that the same can happen in Africa.”
Aldus Aviation is the sponsor of the Aldus Aircraft Africa (AAA) Leasing Project. Through this project, the Bank would help place 12 regional jets in seven African airlines through a leasing facility based in South Africa. “Changing Africa requires new development paradigms and I am proud the AfDB has never shied away from trying new approaches,” Ms. Anvaripour said. Aldus CEO Steve Gorman, for his part, highlighted his company’s “commitment to assisting African companies become more competitive” and expressed his gratitude for the platform provided by the AfDB. By supporting this transaction, the Bank would support regional integration, spur progress in an underdeveloped industry and, for every dollar financed, catalyze about $5 of investment into Africa.