Tuesday, 4 June 2013

Southern Africa's local issues

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While financial turmoil at South African Airways often makes headlines in the sub-region, the Johannesburg-based flag carrier is far from the only troubled aviation asset in southern Africa. Botswana, Zimbabwe, Namibia and others are also struggling to develop suitable air infrastructure to match their relatively niche economies.

“Most governments in southern Africa face a quandary. On the one hand their national carrier plays a vital role in boosting trade and tourism, and on the other the airlines constitute a drain on the national treasury,” explains Nick Fadugba, chief executive of African Aviation Services and a former secretary general of AFRAA...

Monday, 3 June 2013

Fastjet's South African adventure

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Fastjet, the pan-African low-cost carrier backed by Stelios Haji-Ioannou, will begin South African services in July with a Boeing 737-300 wet-leased from local operator Star Air Cargo. Division chief executive Kyle Haywood believes that the launch will restore price competition in a market dominated by two low-cost players – Comair’s Kulula brand, and South African Airways’ Mango subsidiary.

But the myriad legal difficulties Fastjet has endured since its November 2012 launch show no sign of abating, with Comair chief executive Erik Venter already hinting that his new rival’s corporate structure may fall foul of South African law...

Sunday, 2 June 2013

SAA's state shackles

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State-owned South African Airways surprised no-one in May when it said it was borrowing 1.5 billion rand ($167 million) to cover its near-term operating costs. The loan, secured against last year's 5 billion rand government guarantee, will be used as working capital while the flag carrier implements its latest turnaround plan – the ninth such strategy put before its shareholder.

Scepticism about SAA's ability to turn the corner has been fuelled by a spate of management resignations and dismissals, with Monwabisi Kalawe due to become its fourth chief executive in less than a year. Although his interim predecessor, Nico Bezuidenhout, insists that "green shoots" are emerging following last year's 1.3 billion rand loss, the airline's chequered history and its status as an end-of-line carrier has left analysts reserving judgment...

Saturday, 1 June 2013

Iraqi Airways back into the fold

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page 24/25 & page 26/27

News that April was the bloodiest month in Iraq for almost five years has lent credibility to recent warnings that the country may be slipping back into civil war, fuelled by the Sunni Islamist insurgency across its north-western border with Syria. Some 595 civilians were killed violently in Iraq this April, the UN says, doubling the previous month's figure.

But that statistic, grim as it is, remains a world away from the nightmarish scenes at the height of the war in July 2006, when more than 3,200 deaths were recorded in a single month. The deterioration also comes as Iraq pushes through its 2013 budget, earmarking 138 trillion Iraqi dinar ($118.5 billion) of public spending. Though Kurdish lawmakers boycotted the session, Iraq's immense oil wealth is beginning to trickle down to ordinary citizens.

Amid the dichotomy of growing prosperity and deepening violence, flag carrier Iraqi Airways – which was grounded by sanctions throughout the 1990s – is doing its bit to bring Iraq back to the international fold...

The UAE and Canada re-engage

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Abu Dhabi-based Etihad Airways and Air Canada recently signed a Memorandum of Understanding to begin selling tickets on each other's flights from the third quarter of this year. Etihad has more than 40 such codeshare agreements in place around the world, but its latest partnership – which follows a thawing of relations between the United Arab Emirates (UAE) and Canada – could be a milestone in the long-running battle between the Gulf carriers and their legacy counterparts, particularly those in the Star Alliance grouping of airlines.

Under the terms of the agreement, Etihad will place its code on Air Canada-operated flights between Toronto and unspecified destinations in North America. In return, Air Canada will put its code on Etihad's bilaterally constrained Abu Dhabi-Toronto trunk route, as well as its Abu Dhabi-London Heathrow service...