Ministers, honored guests, distinguished industry colleagues, ladies and gentlemen. All protocols observed. Good morning. Thank you for the very warm welcome. And a special thank you to TAAG Angola Airlines for their generous invitation and hospitality. Being French, I must say that I feel very much at home in the "Paris of Africa".
Most importantly, thank you to all for attending the first IATA Aviation Day in Angola. I have high hopes that during the course of this day we can, together, address the key opportunities and challenges facing aviation in Angola.
African issues have been a priority for IATA and for me personally. Since joining IATA a year ago this is my fourth visit to the continent. IATA is working tirelessly to ensure that aviation is able to fully contribute to Africa's economic and social development. An example of that is our recently signed agreement with the African Development Bank (AfDB) to work together to strengthen aviation on the continent.
Aviation is important to Africa. Air transport on the continent supports some 6.8 million African jobs and nearly $73 billion in African GDP. And the scale of aviation's footprint in Africa is estimated to increase almost four times over the next two decades. If current demand for air transport is sustained, then by 2035, the number of passengers traveling to, from or within Africa could reach 300 million. That opportunity will bring economic and social benefits—but only if we are well-prepared to absorb this growth.
Opportunities for Aviation in Angola
Angola shares in this promise. Lower oil prices and fluctuations in the US dollar present challenges for Angola's overall growth. But we still see the demand for air travel growing by 6.7% annually for the next 20 years. At that rate, the number of passengers will grow by three times what it is today to 7.1 million. And each of those travelers will bring with them economic opportunity. That will contribute to economic diversification in non-oil sectors such as tourism, commerce, technology and Telecommunications, Information & Communication (ICT). And air connectivity is needed to underpin the success of major infrastructure and mining projects.
President João Gonçalves Lourenço impressed upon me the critical investments that the government is making to ensure aviation's success. That includes the construction of a new international airport for Luanda and recently passed regulatory improvements.
This is impressive progress. Congratulations to the government on its vision and action. Higher oil prices might signal better economic times for Angola. But aviation-specific challenges remain and must be addressed. My message today is that IATA is here to help as a partner in building Angola's aviation success. And in my remarks, I would like to highlight the top four priorities—clearing blocked funds, improving connectivity, efficiently expanding infrastructure and continuously improving safety.
The first is the challenge of blocked funds. It is not unique to Angola. Carriers are facing currency repatriation problems in nine African countries. We understand the difficulties created by the fall in oil revenues. But if airlines cannot repatriate their revenues they will be unable to provide vital connectivity. And that will put even more pressure on the economy.
To protect aviation's economic benefits, the government must categorize aviation among the high priority industry sectors and ensure that the accumulated backlog of funds—some $535 million as at December—is cleared expeditiously, in full and at fair exchange rates. And, airlines need a stable policy environment so that they can be assured of the timely repatriation of funds going forward.
Together with the industry, IATA will continue to work closely with Angolan authorities to seek possible measures to make the funds available. We welcome the commitment made yesterday by the Government to try to find a practical solution to release blocked funds in line with global standards and bilateral treaty obligations.
The second priority is improving connectivity. Angola's economic and social development needs to be supported by efficient air services. People need to meet in order to do business. And products need to be shipped to buyers. Yet intra-Africa connectivity remains a challenge that is stunting economic growth across sub-Saharan Africa.
Angola cannot realize the full value of aviation or achieve its vision to be an aviation hub without links to its neighbors. I would challenge the Government to see success in its national issues by focusing on the strategic development of pan-African aviation
Enhancing air connectivity would stimulate demand and competition, make air travel more affordable and thereby enable much higher volumes of trade, tourism and commerce between Angola, its African sister nations, and the rest of the world. The potential socio-economic benefits of this provide a compelling argument.
To quantify; an IATA study revealed that if just 12 key markets across Africa, including Angola, opened their skies, an extra 155,000 jobs and $1.3 billion in annual GDP would be created. And a potential five million extra passengers a year would have the chance to travel. In Angola alone the benefit would be an extra 531,000 passengers taking to the skies, the creation of 15,300 jobs and an additional $137 million in GDP would be generated. The logic for opening Africa's skies is compelling.
The imminent launch of the Single Africa Air Transport Market—SAATM—by the African Union this month is good news. Through the SAATM, Africa has the potential for remarkable transformation but it is up to the industry and governments to fully embrace the project if it is to unlock the full benefits of aviation in Africa. We would urge Angola to join SAATM and not lose out on the many opportunities of a connected continent.
Efficient Infrastructure Expansion
And that brings me to the third priority, which is efficiently expanding infrastructure. We welcome the commitment of the Government to build a new airport for Luanda. Airlines need airports that match demand with capacity while delivering the functionality, levels of service, and operational efficiency to support operations and customer experience requirements now and in the future. All of this must be delivered in a cost-effective manner. Let's remember that unnecessary capital investment leads to higher costs for airlines, which can reduce passenger demand for air travel.
Building a new airport is a major undertaking. So getting it right is critical. IATA's Smarter Regulation principles provide good guidance and have been adopted by ICAO as Good Regulatory Practices. Smarter regulation is built on intensive consultation with industry in order to solve real problems while respecting global standards, with transparency and fairness.
With this in mind, I encourage Angolan authorities to engage with the airlines as early as possible so that user needs can guide the development of Luanda's new airport. Among the items at the top of the consultation agenda is the establishment of a Charges consultation process in line with the framework of ICAO recommended practices.
Working together with users is the best way to ensure the new airport's success. And the use of Smarter Regulation principles should not stop with the development of the charges regime. They are a recipe for success that all governments can use to build regulations in partnership with industry to facilitate growth and development without unexpected surprises or unintended consequences.
The last priority that I will address is the most critical—safety. As we have been recently reminded with the tragic Air Guicango crash last year, when it comes to safety there is always more to be done.
Safety has always been a challenge for Africa. But there are clear improvements. In our latest safety report released in 2017, there were no fatalities or hull losses in the operations of sub-Saharan Africa registered carriers in 2016. The region's carriers and governments deserve a hearty congratulations on this great achievement.
Global standards underpin aviation safety. That's why the commitment of airlines to IOSA is so important. And we see the results in the numbers. There are 33 sub-Saharan airlines on the IOSA registry—including TAAG. Collectively their safety record is better than those airlines from the region not on the registry. Twice as good in 2016 and 7.5 times better if you look at 2012-2016 period.
My message to the government of Angola is two-fold.
- First, recognize the safety benefits that the IOSA global standard can deliver and make it a requirement of your safety oversight and licensing processes.
- Second, work to improve compliance with ICAO's global standards in your own regulatory framework. To date only 24 African states had implemented at least 60% of ICAO's Standards and Recommended Practices. We are encouraging Angola to become the 25th.
Let me bring my remarks to a close on an optimistic note. Significant opportunities exist for aviation in Angola. The potential is impressive as is the vision of President João Lorenço to develop Angola's aviation sector. But a vision without action is simply a dream. And action without cooperation is futile. Last week's announcement of a collaborative operational agreement between TAAG and South African Airways is a signal of Angola's intent to give its vision some wings.
Everyone in this room is critical to achieving success. And IATA is a committed partner in the process. Our relationship with Angola is long-standing. Today we are proud to have some 21 accredited Travel Agents in Angola. Of course, TAAG was one of IATA's earliest member airlines, joining IATA in 1951. And in that same tradition of cooperation and leadership, we congratulate and thank TAAG for their commitment to sign the United for Wildlife declaration, which will help preserve the many endangered and iconic species on which Angola is building a thriving tourism sector.
We are keen to strengthen our links with Angola beginning with the integration of the country into the IATA interline and Billing and Settlement Plan (BSP) system. It is a global standard program that facilitates the efficient and secure distribution of air tickets even for the most complicated journeys.
Safe, efficient and sustainable air travel plays an enormous role in our world. Air connectivity moves us forward on the UN's sustainable development goals, including the eradication of poverty. I am so confident in the potential of this industry that I call it "the business of freedom". Aviation's success helps economies to develop and people to live better lives.
I sincerely hope that this Aviation Day will help cement cooperation among the players in Angola's aviation sector and pave the way for a successful aviation sector to be a greater force in Angola's future development.