This House would encourage governments to implement an ‘open sky’ agreement within Africa

The introduction of a Pan-African Open Sky agreement will ensure competition. A competitive airline industry will have a cumulative effect on prices and safety standards. First, prices will be reduced as the market is no longer monopolised by a few airlines. Currently national governments are able to place strict regulations, high fuel and passenger taxes on airlines. Liberalising the industry would mean that airlines are increasingly controlled by the hand of the market, not the state. Competitive airline prices will ensure air travel is no longer exclusively an elite luxury.

Secondly, introducing new competition will force airlines to implement higher standards - of service and safety. Power is redistributed to the consumer and traveller, who are able to pick and choose the best service. Therefore the companies need to be on the top of their game.

Evidence in Europe has shown the competitiveness of liberalisation, resulting in the rise of cheap air travel. Such low-cost carriers now account for a third of intra-EU travel (ECMT, 2010).

To what extent will a competitive industry emerge if direct problems are not resolved? The issue is not simply a need to introduce more airlines. Airline prices cannot be reduced unless fuel prices are lowered. The cost of buying fuel for airlines remains higher in Africa; suggesting that it is not just the airline market but also the market in fuel supplies that requires change. There will be no opportunity for European style budget airlines so long as fuel is expensive.

Additionally, can a competitive airline industry emerge without transparency and good governance first? The fact good governance remains debatable in many African states raises a question of how the market will work. As new business opportunities arise who will be setting up new airlines? It is likely to be government cronies or those with support from the government rather than those with the most innovative models. 

The aviation industry is vital for economic growth for bringing Africa into the positive side of globalisation. The state-owned Ethiopian Airlines Enterprise is one example of a success story for an African airline. Ethiopian Airlines has the greatest amount of traffic as a result of air traffic liberalisation. The returns gained from Ethiopian Airlines have been central to promoting Ethiopia’s national growth strategy. Governments can only gain from liberalisation in multiple sectors, including airlines. Liberalisation, and deregulation, of airlines acts creates cumulative causation, where one event causes multiple changes, for tourism, production networks, jobs, and infrastructure development. In Ethiopia, air networks are building industries and the pushing regions economic development[1]. In Kenya’s case, deregulation of airlines may improve the speed and availability of key global commodities, such as tourism, and flowers[2] - booming industries that require rapid transport.

In Africa 20% of tourism-related jobs are supported directly by the aviation industry (World Bank, 2014).

[1] See further readings: Anna Aero, 2013.

[2] See further readings: Lawrence, 2011.

Integration through globalisation is not necessarily, or purely, positive. Globalisation can have desirable and undesirable effects. For example greater airline links may encourage educated Kenyans to leave creating a brain drain; the country already exports nurses.(Lehmann, 2004)

Introducing a treaty whereby flights are liberalised across Africa, and foreign airlines incorporated, will provide benefits for Africa. For example, foreign companies will be able to tackle gaps in the market. Currently there is a lack of direct flights between key destinations. Direct flights mean direct interconnections to desired; and new, places. For example, with new business opportunities emerging in Nigeria a direct flight connecting Cape Town and Lagos requires investment.

Air traffic in the EU is a positive example. As a result of deregulation budget airlines have expanded throughout the continent EU air traffic and new flight routes introduced. There has been a 120% increase of intra-EU routes and 320% increase in the number of routes provided by at least two companies (ECMT, 2010).

We need to be critical of what foreign business and multinational corporations can do for Africa. Earnings from foreign airlines will likely leave the continent rather than being used for African development. There will be some benefit with some local workers, particularly in airports, but the degree of power inequality between foreign airline owners and local people implies benefits will be unequally spread.

On another hand, what will incentivise foreign airlines to stay? Markets are volatile; therefore a long-term vision is required. What will ensure foreign investors buying airlines are encouraged to stay and actually build a stable, functioning airline market rather than simply taking advantage of the few routes where they can make a quick profit?

The introduction of a Pan-African Open Sky agreement will ensure competition. A competitive airline industry will have a cumulative effect on prices and safety standards. First, prices will be reduced as the market is no longer monopolised by a few airlines. Currently national governments are able to place strict regulations, high fuel and passenger taxes on airlines. Liberalising the industry would mean that airlines are increasingly controlled by the hand of the market, not the state. Competitive airline prices will ensure air travel is no longer exclusively an elite luxury.

Secondly, introducing new competition will force airlines to implement higher standards - of service and safety. Power is redistributed to the consumer and traveller, who are able to pick and choose the best service. Therefore the companies need to be on the top of their game.

Evidence in Europe has shown the competitiveness of liberalisation, resulting in the rise of cheap air travel. Such low-cost carriers now account for a third of intra-EU travel (ECMT, 2010).

To what extent will a competitive industry emerge if direct problems are not resolved? The issue is not simply a need to introduce more airlines. Airline prices cannot be reduced unless fuel prices are lowered. The cost of buying fuel for airlines remains higher in Africa; suggesting that it is not just the airline market but also the market in fuel supplies that requires change. There will be no opportunity for European style budget airlines so long as fuel is expensive.

Additionally, can a competitive airline industry emerge without transparency and good governance first? The fact good governance remains debatable in many African states raises a question of how the market will work. As new business opportunities arise who will be setting up new airlines? It is likely to be government cronies or those with support from the government rather than those with the most innovative models. 

The aviation industry is vital for economic growth for bringing Africa into the positive side of globalisation. The state-owned Ethiopian Airlines Enterprise is one example of a success story for an African airline. Ethiopian Airlines has the greatest amount of traffic as a result of air traffic liberalisation. The returns gained from Ethiopian Airlines have been central to promoting Ethiopia’s national growth strategy. Governments can only gain from liberalisation in multiple sectors, including airlines. Liberalisation, and deregulation, of airlines acts creates cumulative causation, where one event causes multiple changes, for tourism, production networks, jobs, and infrastructure development. In Ethiopia, air networks are building industries and the pushing regions economic development[1]. In Kenya’s case, deregulation of airlines may improve the speed and availability of key global commodities, such as tourism, and flowers[2] - booming industries that require rapid transport.

In Africa 20% of tourism-related jobs are supported directly by the aviation industry (World Bank, 2014).

[1] See further readings: Anna Aero, 2013.

[2] See further readings: Lawrence, 2011.

Integration through globalisation is not necessarily, or purely, positive. Globalisation can have desirable and undesirable effects. For example greater airline links may encourage educated Kenyans to leave creating a brain drain; the country already exports nurses.(Lehmann, 2004)

Introducing a treaty whereby flights are liberalised across Africa, and foreign airlines incorporated, will provide benefits for Africa. For example, foreign companies will be able to tackle gaps in the market. Currently there is a lack of direct flights between key destinations. Direct flights mean direct interconnections to desired; and new, places. For example, with new business opportunities emerging in Nigeria a direct flight connecting Cape Town and Lagos requires investment.

Air traffic in the EU is a positive example. As a result of deregulation budget airlines have expanded throughout the continent EU air traffic and new flight routes introduced. There has been a 120% increase of intra-EU routes and 320% increase in the number of routes provided by at least two companies (ECMT, 2010).

We need to be critical of what foreign business and multinational corporations can do for Africa. Earnings from foreign airlines will likely leave the continent rather than being used for African development. There will be some benefit with some local workers, particularly in airports, but the degree of power inequality between foreign airline owners and local people implies benefits will be unequally spread.

On another hand, what will incentivise foreign airlines to stay? Markets are volatile; therefore a long-term vision is required. What will ensure foreign investors buying airlines are encouraged to stay and actually build a stable, functioning airline market rather than simply taking advantage of the few routes where they can make a quick profit?

Development is shifting from just GDP growth towards promoting a sustainable approach to growth. The UN has created the Sustainable Development Goals for development post-2015, which emphasise developmental policy and practice today has to meet the needs of the present without jeopardising future populations. Therefore how can a new Open Skies agreement be justified on environmental or sustainability grounds? Encouraging more air traffic will act to increase the human burden on the environment.  Key concerns are noise and atmospheric pollution, deforestation, and the use of space. Flights produce around 628,000,000 tonnes of CO2 annually adding to climate change (Clean Sky, 2014). With numbers rising the pressures will too.

Sustainable development does not mean stopping development. The SDGs emphasise how a new perspective is required for future development. There is no evidence to suggest an open-sky agreement would increase environmental degradation, nor is there to say that if an open-sky agreement is not implemented we will develop in a more sustainable way. The introduction of open-skies will mean an introduction of better planes – more fuel-efficient and eco-friendly designs as a result of competition on quality and safety. Advancements have been made over time to improve the environmental performance of aeroplanes. Today’s planes are 75% quieter, with carbon-monoxide levels declining by 50%, and increasingly more fuel-efficient[1]. An open-skies agreement enables new ideas and designs to be integrated, encouraging the implementation of sustainable models. 

Sustainable development is about how we understand, appreciate, and implement future objectives. An open sky agreement is not necessarily unsustainable.

[1] See further readings: IATA, 2014.

Terror remains a key concern both in and about Africa. A key issue with a potential open sky agreement is who will regulate it and how. Effective control to prevent terrorism is required; passengers and nations need to be ensured security. Liberalising airlines and markets potentially lays the foundation for a new risk of terror and insecurity. West African airports have been particularly criticised for their lax security which creates an insider threat (Brandt, 2011). More planes, more staff, and more passengers mean a higher probability of risk. Is liberalisation best when we consider the war on terror, and emerging security risks? 

We need to be cautious in falling into the ‘terror discourse’. Since 9/11 the cases of hijacking have not risen substantially. The discourse is a key concern among Western states. Terror is a risk, however Western states have implemented open-sky agreements – such as between the US-EU despite such threats. So why should the risk of terror stop Africa implementing open-skies when the Global North has done so? It returns to the relations of power in the global-political economy.

The global-political system is key in constructing a discourse of fear and using this to influence how we act, invest, and work. We need to deconstruct the terror discourse first, to understand what really are the risks and whether liberalising air networks will really make a difference either way. Once the specific risks have been analysed those that are concerns can be addressed including any concerns about terrorism.

The success of airlines such as Kenya Airways has emerged through alliances; not an ‘open sky’ agreement. The airline has created alliances with small airline carriers such as Precision Air to ensure more frequent coverage, competitive prices and provision of services to new destinations. Increased connectivity across Africa requires more alliances between individual airlines, not necessarily an open sky agreement. The alliances made ensure universal boundaries, rules, and regulations, are set through corporate ethics and responsibility. Alliances mean the corporate brand is at stake.

Alliances are a safer option when we consider who will set the rules with an ‘open sky’ agreement in Africa. Alliances can ensure safety measures remain central for airlines, and the private actors are held responsible. However, the definitions of, and decisions on, rules become blurred with an ‘open sky’.  Who will have the last say? Whose decision will hold power? A regulatory board is required, which can be granted through alliances.

Alliances create an oligopolistic market. The promotion of alliances creates two key market results – controlling supply and demand. Firstly, choice is restricted. Customers are restricted in what prices and services are available. Secondly, the market competitiveness is restricted. Different airlines are not able to compete with each other, but merely cooperate as the leading company takes the largest proportion of profits. Alliances fail to stimulate a competitive market or place companies on an equal platform to compete for profits.

Open skies are also seen as a means to ensure safety and reduce the rising accident rates. The World Bank (2014) note accident rates would fall if African states use bilateral sanctions to ensure airlines meet safety standards; currently Africa’s aircraft hull-loss accident rate is more than 6 times higher than Asia and Latin America and 12 times Europe. Open-skies ensure bilateral collaboration and intervention.

An open sky agreement will only act to reinforce the brain drain occurring in Africa. The level of development across Africa remains uneven, with disparities found across the continent based on GDP, PPP, FDI, and social development. An open sky agreement may act as cumulative causation for out-migration of trained professionals and white-collar jobs to more developed countries. One very obvious brain drain as a result of air travel is that there have been eight hijackings of Ethiopian Airlines by pilots attempting to get asylum in the last 25 years (Nadeau, 2014). The reality would bring detrimental effects for some countries, and prosperity for others. The unequal geography of development in Africa will persist.

Several points require countering. Firstly, the focus on the brain drain suggests air travel will continue to be dominated by an elite class, however, open-skies acts to enable a broader customer base. Secondly, migration brings a range of benefits – we cannot promote keeping people in their place as a developmental solution. Even if national development comes first people may still want to move. Finally, people will not be discouraged from moving if there is no open-skies agreement. Migration is historic in Africa, with multiple transport modes used. Migration will continue to operate with or without an open-skies agreement.

Therefore it is important to recognise the role open-skies can play for Pan-Africanism. An open sky will assist in dispersing access and availability to development opportunities. It will create new network hubs within Africa; and create new market opportunities by introducing frequent airlines to places previously inaccessible. The agreement would ensure capital is spread across Africa. Africa will begin to operate cohesively. The open-sky agreement sets the future agenda for Africa’s development – a step towards Pan-African cooperation.