New flights would mean greater connectivity

When China Southern Airlines touches down at the Jomo Kenyatta International Airport in Nairobi on August 5, it will be the first time a Chinese airline has made a direct journey to the African continent, heralding a new era in aviation. The flight is expected to operate three times a week from China's southern city of Guangzhou to the Kenyan capital and offer an alternative service for Kenyan travelers.

The new direct service could shave off two hours in travel time between China and continental Africa and signify the start of a growing trend. Another Chinese airline, Air China, is expected to launch flights between Beijing and Addis Ababa starting from October 26.

The launch of the Chinese direct flight routes is seen as a response to the growing ventures by African airlines into China.

Both Kenya Airways and Ethiopian Airlines, two of Africa's largest flight operators in terms of networks, already fly into China, with Ethiopian going to several cities.

According to the Center for Aviation, an organization that analyzes market trends in aviation, the traffic flow between Africa and China has been increasing steadily since 2005. Ethiopian Airlines is expected to transport at least 360,000 passengers this year, followed by EgyptAir (140,000), Kenya Airways (90,000) and South African Airways (49,000).

While China Southern Airlines did launch leisure flights between Shenzen and Mauritius last year, mainly targeting tourists, the island nation lies off Africa's east coast; the new venture will target the continental mainland.

Future prospects

In 2014, while on his official visit to Africa, Chinese Premier Li Keqiang called for stronger collaboration between Africa and China - involving investments, and road, rail and air transport - to open up the continent to more trade.

But it is also about future prospects. According to the International Air Transport Association (IATA), eight of the top 10 fastest-growing markets in the next 20 years will come from Africa. Demand for air travel is expected to grow around 5 percent a year for the next 20 years, providing opportunities for air carriers, both domestic and foreign, to open new services and have a share of the aviation pie, the IATA said in a brief.

"With the Chinese economy expanding and African economies set for major growth in coming years, the potential for increased trade and tourism between China and Africa is an excellent one for Chinese and African carriers to take advantage of," Raphael Kuuchi, IATA Vice President for Africa, told ChinAfrica.

Alternative markets

Kenya's Ministry of Tourism estimates reduced travel time would encourage Chinese tourists to visit Kenya.

"Our traditional markets have been drying up," Phyllis Kandie, Cabinet Secretary for East African Affairs, Commerce and Tourism, told ChinAfrica, referring to traditional sources like the United Kingdom, United States and Australia. "We need to look for new markets which can be tapped if there are convenient travel means."

Tourism, Kenya's second highest foreign exchange earner in the recent past, has almost collapsed after Western countries issued continual travel advisories warning their nationals against traveling to Kenya in the wake of several terror incidents. Kenya's coastal areas depend almost entirely on revenue from an estimated 1 million tourists annually.

Experts say the impact of Chinese arrivals could be positive or negative, depending on how airlines react.

"A lot of people travel to China these days. The Chinese are increasingly involved in many businesses in Africa [and] trade is increasing," Dr. James Wanjagi, a commercial airline analyst in Nairobi, told ChinAfrica. "We [Kenyan airlines] have not been serving everyone who comes from China. If the price is right, the impact will be huge. The question will be how competitive one would be."

Competition and challenges

Traditionally, flying passengers from Africa to China was the preserve of Kenya Airways, Ethiopian Airlines and a number of Middle East airlines. The two new entrants mean there will be additional carriers for passengers. But there will also be new competition, a battle over fares, and a tussle over market share with locals.

"I think local airlines will survive if they adopt certain strategies. For example, the aircraft will have to be right. Also, it will be important to see if they can keep their prices right. I am seeing a big price war," said Wanjagi. "The way to look at it is to find out who is eating your lunch, how they are eating it, and how you can change it. Obviously, by adjusting your prices and making your service better."

The two new entrants may in fact not be competition at all if local airlines adopt collaboration rather than a competition strategy, he added. The biggest challenge for the Chinese carriers will be how to collaborate with other airlines to enable their passengers to reach other cities in Africa. This is where Ethiopian Airlines, Kenya Airways and South African Airways have an opportunity to gain, because they will determine prorate fares, the fares an airline charges another to carry passengers between two points.

There are other challenges. "Any carriers opening routes to Africa will face the same challenges that existing operators have faced for many years," Kuuchi pointed out. "Safety remains a perennial issue in Africa, although governments and the industry alike are making huge improvements in this area."

Other challenges include fluctuating fuel prices, infrastructure charges, a shortage of world-class airport facilities in some areas, and lack of a liberalized air-services framework.

The African continent has the most restrictive airspace in the world. Despite the fact that 16 of the continent's 54 countries are landlocked, there are still protectionist charges and non-tariff barriers to the free movement of people, let alone aircraft. This makes air tickets not only expensive but also reduces revenues for operators. Prominent airlines in Africa have survived because their governments have signed bilateral air transport agreements with the areas they fly to. This has enabled them to grow destinations and increase frequency.

In 1999, 44 countries in Africa signed the Yamoussoukro Decision, a document outlining a number of air transport "freedoms" to open up the skies. Still most of the countries are reluctant to implement the agreement though it is profitable to open up the skies. Air transport supports 6.9 million jobs in Africa and injects $80 billion in the GDP, according to the World Bank.

Last year, the IATA commissioned a study to determine the impact of liberalizing skies in 12 African countries with a combined international passenger traffic of more than 60 million a year. The findings indicated passengers would save at least $500 million in discounted fares and enjoy reduced travel time. At least 155,000 jobs would be created, leading to an additional $1.3 billion in the GDP.