AFRICA CONNECTS
HOW THE BUSINESS TRAVEL INDUSTRY IS RISING TO THE CHALLENGE OF KEEPING PACE WITH THE CONTINENT’S DYNAMIC ECONOMIC GROWTH
THE AFRICAN ECONOMIC OUTLOOK report for 2014, produced by the African Develop- ment Bank, OECD Development Centre and United Nations Development Programme, showed notably healthy economic growth on the continent. The report projects growth of 4.8 per cent in 2014, and 5-6 per cent in 2015 – this reaches the levels not seen since before the recent global economic crisis. It predicts foreign investment to be more
than US$80 billion in 2014, and notes the Human Development Index – reflecting income levels, health and education – shows 1.5 per cent annual growth, with 15 countries now rated as “medium to very high human development”. The factors driving economic growth
in Africa are varied. Ethiopian Airlines CEO Tewolde Gebremariam cites Africa’s untapped natural resources as attracting foreign investment, including “42 per cent per of the world’s gold, 20 per cent of global oil reserves, 90 per cent of global diamonds and 60 per cent of uncultivated arable land”. Other factors include foreign and internal investment in infrastructure, technological advances and social progress. Paul East is chief operating officer at
Wings Travel Management, which was founded in Johannesburg and specialises in the energy sector. He says: “Africa is un- dergoing a transformation right now, and
the world is definitely putting more focus on the continent – both in terms of private equity investment and natural resource exploration. According to the World Bank, 11 out of the 20 fastest growing countries globally are in sub-Saharan Africa.”
MAJOR GROWTH IN FLIGHTS So how and where are these changes im- pacting on travel? John Grant, executive vice-president at leading aviation data spe- cialist OAG, says the number of scheduled flights operated to, from and within Africa has increased by more than 50 per cent over the last decade, with just over one million flights due to operate in 2014. He adds: “Interestingly, the airports showing major growth in flights are the more central African hubs of Nairobi, Accra
and Addis Ababa, where a combination of well-operated locally-based airlines, geo- graphic position and increasing economic wealth are all contributing to an increase in market confidence, and a greater range of destinations and scheduled flights.” Gary Kershaw, general manager, UK and
Africa is undergoing a transformation right now, and the world is definitely putting more focus on the continent
Ireland, for South African Airways, is also seeing growing demand for business travel. “According to UK Trade and Investment figures, the bilateral trading relationship between the UK and South Africa is worth around £9.5 billion per year – FDI [foreign direct investment] stock shows the UK is the largest single investor in South Africa,” he says. Over in west African powerhouse Nigeria, leading carrier Arik Air is also seeing change. “Business travel is increas- ing rapidly, alongside the growth of the majority of African economies,” says chief operating officer Conor Prendergast. He says this is being driven by “political sta- bilisation, liberal economic trade access between African member states, and a greater number of airlines popping up offering multiple weekly, or in some cases multiple daily, flights – in turn stimulating demand and creating a more competitive market place.” Arik has ambitious growth plans that
reflect the country’s dynamic economy. Prendergast says the airline’s five-year
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BBT JULY/AUGUST 2014
BUYINGBUSINESSTRAVEL.COM
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