Cargo traffic set to create growth of South African airports

Despite facing challenges such as high fuel prices and limited connectivity, within the continent and with the rest of the world, Africa’s air cargo traffic is set for growth in the coming years on the back of a projected rise in trade.

Data released by the International Air Transport Association (IATA) for April 2024 shows that global air cargo markets were seeing strong annual growth in demand into the second quarter of the year.

At the same time, African airlines saw 10.6% year-on-year demand growth for air cargo in April.

Demand in the Africa-Asia market increased by 25.8% compared to April 2023.

“Aviation, and specifically air cargo, has the potential to be a significant driver of socio-economic growth and development across the African continent, as air freight creates huge economic value for an airport’s region or country, enabling local trade and attracting new high-value industries,” said Terence Delomoney, Airports Company South Africa (ACSA) group executive operations manager.

“Air cargo, which allows the transport of goods quickly by air, is a big trade enabler and could potentially drive economic recovery across the region because the global economy depends on the ability to move goods quickly and at competitive prices.”

Delomoney noted that the establishment of the African Continental Free Trade Area (AfCFTA) agreement is expected to boost intra-Africa trade.

AfCFTA is the world’s largest free trade area, bringing together the 55 AU member countries and eight economic regions.

As part of the AU Agenda 2063 strategy, AfCFTA aims to boost income by $450b (around R8 trillion) and lift more than 30 million people out of poverty across the continent.

“While air cargo across the continent, including South Africa, has not yet taken off to the extent that it should have, a concerted effort by all stakeholders to improve the air freight sector will ensure that exporters and importers have viable options to deliver high-value goods quickly and efficiently,” said Delomoney, adding that Africa accounts for 18% of the global population, but only 2.1% of air transport activities combined cargo and passenger.

However, Delomoney stated that the World Bank estimated that the AfCFTA could boost Africa’s exports to the rest of the world by 32% by 2035 and catalyse foreign direct investment, which is expected to rise by between 111% and 159%.

“There is little doubt that the AfCFTA has vastly improved African trade and growth prospects.

“This comes at a time when there is a growing realisation amongst African nations that gross domestic product growth on the continent will need to be fuelled by increased trade between countries on the continent,” said Delomoney.

“But to boost Africa’s air cargo efficiency, airport management companies on the continent will need to start investing in the necessary infrastructure, improving airport facilities, expanding cargo terminals, and upgrading air traffic control systems.

“Improvements such as these will no doubt help to increase the efficiency and capacity of air cargo transportation.”

He explained that, in line with this, ACSA aims to enhance its efforts to support air cargo traffic growth with initiatives and infrastructure developments designed to ease congestion and expand warehouse space in the short and long term.

A key highlight of the programme is the construction of the mid-field cargo terminal at OR Tambo International Airport, which is critical in addressing the soaring demand for cargo capacity right in the heart of the country’s regional economic hub.

“ACSA is placing a strong focus on Africa, with a specific goal to diversify and spread its source markets for international traffic, with the African continent being identified as low-hanging fruit. The organisation’s ultimate aim is to be connected to every major city in Africa,” said Delomoney.

He added that companies such as ACSA can benefit from greater engagement with air cargo stakeholders about the particular type of infrastructure that will ultimately support their needs, as there would be little point in creating infrastructure without being sure that it will fulfil the functions that will support these stakeholders.

“Our ambition remains for air cargo is to attract international air transport companies to choose O.R. Tambo International Airport or one of the other ACSA airports as a hub for their international and regional operations.”

“OR Tambo is currently the busiest airport in Africa, handling an average of 251 flights daily. It operates flights from its two terminals, the most frequent route being to Cape Town, with an average of 300 weekly flights, accounting for 17% of all weekly departures.”

In September, ACSA will host the 33rd ACI Africa annual general assembly, general assembly, regional conference, exhibition and air show in Johannesburg.

This event will include airport management organisations, industry leaders, and aviation experts from across Africa and will, amongst others, look at how the continent can gear up its operations to make its economic hubs more attractive to do business on the continent.