International air transport today, an appalling slaughter

All the specialists and analysts of the Air Transport economy, all the dedicated professional Organizations (ICAO, IATA, ACI/CIA, FUNUAP, etc.), all the States of the world, like the multilateral Organizations, are today unanimous and terrified to witness, in utter helplessness, the extraordinary and appalling catastrophe of the economic tsunami that has suddenly befallen the international aviation sector, after just a month and a half of the devastation of the global COVID 19 pandemic.

There is no doubt that the entire world economy of air transport, the entire configuration and architecture of this international industry are and will be further turned upside down, regardless of the size of the structures that operate there, the legal status that frame their activities, the sophistication of their organizations and their management, strategic alliances, market volumes, traffic flow, aircraft fleets, network structures, etc. It's a total upheaval.

It must be said bluntly, it's a whole world that is capsizing, collapsing... resulting in a hecatomb never known in the past. An old world is leaving us. And as always, Eternal Transcendence and Imperious Divine Law, Life and Death, Death and Life, alternate and intertwine, punctuating the course of History, to lead human societies into endless changes and changes.

What world of air transport will it be? At the International scale ? in Africa ? in our West African sub-region? Who can say ? One certainty however, another world will be… and all dotted, let's guess it.

The return of the Regal State, the only Savior

I don't believe that, without massive, vigorous and voluntary intervention by sovereign states, no airline in the world, public or private, can recover. It is impossible in this crisis, and immediately afterwards, that with only the own and internal dynamics of the economy of air transport, an autonomous self-regulation can be done. It is constant to note that since the last war, the internal margins in air transport have always been weak, incapable by themselves of generating and ensuring alone, without external transfers, the massive capital investments that the sector requires.

The French Prime Minister has just announced the color, affirming that his country will not hesitate to resort to the subterfuge of the renationalisation by the French State of Air France, for its express rescue from the current crisis. His European peers are drafting similar plans. The European Union has just lifted a severe budgetary constraint, to leave more leeway to its Member States, in order to be able to run up more debt and thus acquire more means to cope with the terrible economic crisis which is about to arise. A very last information falls to learn that the Italian government has just renationalized Alitalia. Everyone also remembers the American precedent, during the financial crisis of 2007-2008, which, with colossal direct injections of capital from the Federal State and the Federal Reserve Bank, was able to save private American banks from total sinking. Bis repeated 12 years later, President Trump, this time again, will not hesitate to fly to the aid of private airlines by massive injections of capital. And still today, even the ultra-liberal IATA does not see any other possible paths other than recourse to public intervention by States.

The immediate and essential question is above all, will this be enough to save the furniture?

And what fate for Air Africa, in this upheaval by COVID 19

As always, our continent lives out of step with the rhythm of the world economy. The upheavals reach it in the second or third wave, and sometimes even the fourth wave or more with immeasurable devastation given the scarcity of means. The economy of air transport in the continent is extremely weak, few of its airlines can claim the minimum size to exist in the world market.

South Africa Airways (SAA) practically in clinical death may not recover. Kenya Airways, already very weakened by a recent restructuring, risks falling back into the major imbalances that had weighed it down. EgyptAir, Royal Air Maroc without significant and direct intervention from their respective states will not be able to resume even half the level of their recent activities. Only Ethiopian Airlines, which is the 1st continental company, current pride of Africa, can hope to be able to cope with difficulty, given its history, its past experiences, its management and its relative size. It is certainly a great challenge today for its current management. And this one is not won in advance.

Our West African sub-region does not present a better figure. Nigeria of 203 million inhabitants, jealously protective of its internal market and captive traffic, encloses private airlines run by risky and uncertain managements. The current crisis will wipe out many of them, and the Federal State will try to save a certain number of them. The game is not so won.

The other airlines in the French-speaking sub-region, Air Côte d'Ivoire, the very latest Air Senegal SA, TACV, Air Burkina, ASKY will find themselves suffocated by the mountain of debt resulting from their recent indebtedness, which financed their latest active aircraft; they will be weakened against the ECA (Export Credit Agency), against the lessors and the aircraft manufacturers from whom these assets are acquired. If ASKY will follow the fate that its mentor Ethiopian Airlines will want to reserve for it, the 3 other national flags (Air Côte d'Ivoire, Air Senegal SA and Air Burkina) which see their destiny very strongly linked to the will of their respective states will be paralyzed , if there is no injection of several tens of billions of FCFA from their own States, in order to restart very painful restarts. States are essential today. I hope our people are well aware of this.

A mode is collapsing…Another is taking shape.

Seven years have already passed, in a desperate direct appeal to two of our French-speaking heads of state in our region, Mr. Macky Sall and Mr. Alassane Ouattara, I wrote in the editorial of the bimonthly "Transports et Tourisme International" N° 16 from February-March 2013, under the title that Lapalisse cannot deny, the following prompt, “What we cannot do alone, we can do together”.

''If yesterday, Houphouët Boigny and Léopold Sédar Senghor had achieved the feat of setting up Air Afrique, which was able to exist for 40 years, with many multifaceted economic successes, today circumstances place Alassane Ouattara and Macky Sall in a privileged historical position to take up the torch and lay the foundations of one of the regional companies, which could potentially become one of the powers in Africa. Like Royal Air Maroc and Egyptair in North Africa, Ethiopian Airlines and Kenyan Airways in the East or South African Airlines in the South of the Continent. In doing so, without a doubt, they will involve all the other countries of the WAEMU and ECOWAS zone which live the same community of destiny''. Later I added that '' this is surely the way. This requires political will, the determination of those responsible at the highest level and cooperation between our States. I believe that Macky Sall and Alassane Ouattara can carry this great regional initiative without firing a shot. Both countries have the means.

Alas! Alas! 3 times Alas! This call had no response. Time has flown. The 2 countries have walked alone, each on its own, venturing into national pavilions which have difficulty in truly deploying, limited and cloistered as they are in cramped markets, which they dispute fiercely, between themselves and with others. Worse, if we were to have fun adding up the accumulated deficits and losses of the activity of these 2 airlines over the past 7 years, it is not less than 250 billion of our CFA francs that we would have to carry over to again in the accounts of their respective balance sheets. None of these airlines has ever made any money in all this time. And still far ahead, they won't win any. It is our States that support them at arm's length.

An old world is collapsing… another is taking shape… it is becoming… uncertain and vague, which will give birth to new paradigms. COVID 19 invites us to learn from our past, to have to question ourselves, about our successes and our failures, especially our failures, in order to be able to understand and build another world, freer, more empathetic and more prosperous.

Air Senegal and Air Côte d'Ivoire unified is a fleet of more than twenty aircraft grouped together, a better structured regional and international network, and more real credibility and economic rationality.

All it takes is political will. States, the only saviors.

Mr. Tahir NDIAYE
Director General – Aeronautical School (ESA)