Africa’s Air Transport Infrastructure: Challenges, Complexities and Opportunities

Eyden Samunderu
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Eyden Samunderu: International School of Management

Chapter Chapter 5 in African Air Transport Management, 2023, pp 151-187 from Springer

Abstract: Abstract African aviation has witnessed steady growth pre-COVID and as result of increased demand for air travel, there is an urgent need to improve the air transport infrastructure. This chapter examines the underlining complexities and challenges that are undermining the African region’s propensity to exploit its growth trajectory. The chapter explores multiple differences in regional airport infrastructure. Infrastructure is considered a key component of the investment climate, reducing costs of doing business and enabling people to access markets. In general, Africa, by every measure of infrastructure coverage, lags behind their peers in other parts of the developing world. Poor infrastructure of most African airports is seen as a principal reason why the region continues to struggle to fulfil its undoubtedly economic potential. These infrastructure problems can hardly be solved due to limited financial resources and will therefore consequently lead to retaining infrastructure problems. The chapter proposes a series of blueprint measures in order to galvanize Africa’s growth potential within air transport development. This calls for speeding up privatization and allowing more private equity investments to support air infrastructure improvements. The most desired option to finance airport infrastructure would be the Public–Private Partnership (PP). However, on the local level, banks have relative weak capital coffers, which also limit access to infrastructure capital loans. Investors see some underlining risks in financing airport projects in Africa, namely uncertainty related to forecasts of passenger growth numbers. Other risks are embedded in currency markets, whereby most domestic airport infrastructure with project revenues is generated in local currencies, but servicing foreign debt and equity involves payment in foreign currency. The chapter finally examines the impact of COVID-19 on airport operations. From 2019 to 2021, airports were severely affected by the global pandemic causing massive loss of revenues for both airport operators and airlines.

Keywords: Air transport infrastructure; Financing; Public–private partnership; Investments; Revenues; Air traffic; Airport privatization; COVID-19 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:spr:aaechp:978-3-031-29324-5_5

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DOI: 10.1007/978-3-031-29324-5_5

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