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Commentary: Growth of African airlines and implications for Guyana and the Caribbean
Published on May 17, 2017 Email To Friend    Print Version

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By Ray Chickrie
 
The rise of strong African airlines such as Ethiopian Airlines (ET), Rwandair, Kenya Airways (KQ), Royal Air Maroc-RAM (Morocco), Egyptair and South African Airways is unprecedented in history of African aviation, for it is the first time many African carriers have a successful profit and growth formula; using modern aircraft, investing in aviation infrastructure, and they are members of global alliances like Oneworld, Star Alliance and Skyteam. 

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Born in Guyana, Raymond Chickrie was a teacher in the New York City public school system and has also taught in the Middle East
These carriers have created hubs in Lomé (West Africa), Accra (West Africa), Addis Ababa (East Africa), Cairo (Northeast Africa), Casablanca (Northwest Africa), Johannesburg (Southern Africa), Harare (Southern Africa) and Kigali (East Africa). Now African travellers don’t have to leave the continent to London, Paris, Rome or Dubai to travel within and outside of Africa.

What does this mean for Guyana and the Caribbean? Guyana is investing approximately US$200 million to expand and modernize the Cheddi Jagan International Airport (CJIA), and wants to turn the airport into a hub between the Caribbean, Africa and North America.

This endeavour is facing many constraints. The Guyana market is small; it's an ethnic market and the tourism industry needs major investments.  Guyana lacks diplomatic ties with key French speaking West African states like Mali, the Ivory Coast and Senegal, and citizens of only two African countries, Botswana and South Africa, can visit Guyana without the need for a visa. Is the government willing to liberalize its visa regime with African nations, and especially with those with national carriers?

Poor connectivity and commerce between Latin America and Africa

The issue of visas is “sacred” for many countries but, to spur tourism, Guyana and Suriname recently had to abolish visa for nationals of several Latin American countries wanting to visit. When Guyana’s former foreign minister, Carolyn Rodrigues-Birkett,  in 2014 approached  Copa Airlines to come to Guyana, her ministry had to relax its visa requirement for nationals of Panama, Peru,  Ecuador, and  other countries in the region as part of the deal. 

The foreign minister successfully brought all stakeholders by creating synergy, and she used her office as foreign minister of Guyana successfully to bring the first global carrier to Guyana since Delta left. Copa Airlines is the only carrier that has opened Guyana to global hubs like Panama City and Istanbul through its codeshare agreement with Turkish Airlines (THY). 

There is hardly any traffic between the Caribbean and Africa.  Connectivity from Northern Brazil, the Caribbean and North America to Africa and Europe is underdeveloped.  There is little commerce and tourism between Africa, Latin America and the Caribbean. Now that these major African carriers fly to New York or will soon do so, policy makers in Latin America and the Caribbean may find creative ways to tap into this development.

Ethiopian Airlines flies to New York City and Sao Paulo via its Lomé, Togo,  mini-hub linking West African capitals to its Addis Ababa hub in East Africa. South African Airways links Washington DC, Ghana and Senegal to South Africa. It also connects Sao Paulo with Johannesburg. Angola Airlines also connects Luanda to Sao Paolo.

However, there is still a shortage of airlift between New York City and West African capitals like Accra, Conakry, Dakar, Abidjan and Lagos. People in the region looking to travel to Africa must first get to Rio, San Paolo, Miami or New York to get to Africa.  Royal Air Maroc and Gulf carriers connect Argentina and Brazil via their hubs in Doha, Dubai, and Casablanca to Africa cities but that's very time consuming. So far, the best connection to West Africa from Brazil is via Casablanca.
 
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CJIA Runway Expansion – Rendering

Guyana's proximity to West Africa and New York markets

There is a large Guyanese market in New York City and there is a shortage of airlift from there to Guyana. But with the discovery of large quantity of oil and gas in Guyana, could Guyana take off economically if it wisely uses its oil revenue to build its aviation and tourism industries? There is also talk of Guyana reviving Guyana Airways. Maybe Guyana can offer these carriers fifth freedom rights to ferry passengers between NYC, Georgetown (Guyana) and West African capitals. Can one of these carriers make a stop in Guyana?

African governments are investing in aviation infrastructure. Currently, new airports are being built or existing ones are being expanded and upgraded in Accra, Dakar, Kigali, Lusaka, Luanda, Nairobi, Bole, Victoria Falls, and Dar es Salaam. 

To get from Guyana to Brazil right now, one has to fly to Suriname and connect with Surinam Airways (SLM) or GOL; however, one will have to buy several tickets and check luggage several times. The connection isn’t seamless because SLM lacks the ability to sell a plane ticket from Guyana to Brazil via Paramaribo.   It’s nearly impossible to go online and purchase a plane ticket on Cheapoair, Expedia or Orbitz from Guyana to Brazil or to Amsterdam on SLM’s network. So, one must fly from Guyana to Panama City or to Miami to reach Brazil or Venezuela.

From Guyana to Dakar, Senegal,  it’s about 6:30 minutes of flying time and for this reason Guyanese officials often talk about making its Cheddi Jagan Airport (CJIA) a hub that will link the Caribbean, South America, Africa and Europe. But what can Guyana offer any of these African carriers to add Georgetown to their network? Take for example the Ethiopian Airlines growth model. ET invested in ASKY Airline, a small airline based in Lomé, Togo. ASKY flies to all major cities in West Africa. This allows ET to link its Lomé hub (West Africa), which serves about 20 cities in West Africa, to its East Africa hub in Addis Ababa. With eight aircraft, ASKY serves 20 cities. Interestingly, Caribbean Airlines (CAL), with 16 aircraft, serves only about 16 cities and that company has been in the red for decades due to corruption, nepotism, government interference and poor management.

Ethiopia, notwithstanding its glorious ancient past, still isn’t a major tourist destination; 70 percent of Ethiopian Airlines passengers transit through Bole International Airport, a modern hub in East Africa. Ethiopia offers passengers new aircraft, great inflight entertainment and food. Forging partnership with other airlines was a key to ET's success.  It holds a 40 percent stake in the Togo-based ASKY Airlines and a 49 percent stake in Air Malawi, a great example of South-South cooperation. In 2016, Ethiopia also signed a strategic alliance agreement with Rwandair, which allow both carriers access to their respective airspace like the fifth freedom.
 
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New CJIA Arrival Terminal construction in progress

Can Guyana’s CJIA become a hub?

CEO of CJIA, Ramesh Ghir said, “Flight routes to South America, Latin America and Africa out of the English-speaking Caribbean are largely underdeveloped, the expansion of CJIA and mega oil discoveries in Guyana, therefore, creates a unique opportunity for Guyana to develop a hub to serve these unexplored markets through both transit and direct traffic. Once this is realized, the proximity of northern Brazil to Guyana makes Guyana an ideal transit point for the millions living in that region of Brazil.”

Guyana sits between Northern South America (Brazil), the Caribbean, Africa and North America. CJIA can grow if it becomes a hub like Addis Ababa, where the tourists account for a small percentage of passengers and most, some 70 percent, are transit passengers. But how can Guyana take away from Port of Spain’s Piarco and become a hub in the region. Will American and African travelers transit through Guyana to Belem, Manaus, Caracas, Port of Spain, Miami, New York and Georgetown? But why would they want to transit in Guyana? How many African tourists will come to the Caribbean and Latin America?

“It’s difficult to overestimate the various difficulties that we face including those that have to do with the welfare of key sectors of the economy when no major airline is coming our way,” noted Gerry Gouveia, CEO of Roraima Airways and a few other holdings.

Delta a major global carrier did serve Guyana but left in 2013. Guyana was once served by British Airways, KLM and Air France. While KLM flies to neighbouring Suriname, SLM does not offers travelers a seamless journey to its Amsterdam destination; nor does a local airline exist in Guyana that can seal an agreement with KLM to bring passengers from GEO to Paramaribo to connect to Amsterdam and beyond. 

Guyana investments in aviation infrastructure

Guyana is making strides in reaching ICAO goals. It is investing over US$250 million to improve physical and institutional aviation infrastructure throughout the country. The government in particular is keen to open the hinterland. The public/private partnership that built Guyana’s second international airport, Eugene Correia International (Ogle), continues to grow and it is served by international carriers from Barbados and Suriname. This model of small aircraft at Ogle, with more frequency to neighbouring countries for business and future growth of tourism, has the potential to take off.

The CJIA is undergoing major modernization and expansion. A new arrival terminal is being built and the existing terminal will be modernized to accommodate outgoing passengers. Aviation laws and oversight bodies are being reorganized and revamped to address issues of safety and security and ICAO compliance.  Guyana is looking to achieve FAA Category 1, which will allow non-US based carriers to fly non-stop from GEO to New York and Miami. 

Guyana has an open transport policy. The government has sealed bilateral air services agreements with Brazil, Canada, France, Cuba, United States, Kuwait, Turkey and multilateral air services agreements with Caribbean Community (CARICOM) member states. Bilateral air services agreements were finalized with Singapore, China, Kenya, Ghana, Nigeria, Curacao, Canada, United Kingdom, Norway, Netherlands, Qatar, United Arab Emirates and Chile.  However, there are no agreements signed with Rwanda, Ethiopia, Morocco, and South Africa, countries with national airlines.

In 2016, Guyana witnessed 14 percent increase in passenger traffic. This is due to additional airlift and US granting more visas to Guyanese visitors. However, this number may decrease for 2017 due to the discontinuation of Easy Sky Airways, which connected Guyana and Cuba. The Guyana Civil Aviation Authority (GCAA) suspended that service in April 2017. Inselair went out of business and stopped flying to Guyana as well. And as the airport expansion and modernization is set to be completed by the end of the year, there is no talk from government of any significant airline slated to land to grace the new and improved CJIA.

Hence, what is the current government doing to do address the lack of airlift to Guyana today and the exorbitant airfares between Guyana and New York and Guyana and Trinidad and Tobago? Foreign Minister Carl Greenidge met with JetBlue two years ago but there seems to be no progress in the negotiation. The Guyana government can learn a lot from Rwanda’s successes in the aviation and tourism industry after a bloody civil war.  Should he personally intervene and talk to South African Airways, Kenya Airways, Ethiopian Airlines and Rwandair about how they can help Guyana?

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Runway extension in progress

 
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