Robust air travel demand outlook

Optimism about the strength and sustainability of Africa's economic growth has increased recently. Sub-Saharan Africa weathered the financial crisis of 2008 and 2009 and commodity price volatility particularly well, continuing to achieve above-world-average economic growth. Accordingly, both the IMF and World Bank increased their expectations for sub-Saharan Africa's economic growth over the next two years, despite a relatively weak global outlook.

Africa's long-term economic growth rate of 4.4 percent is well above the world average. Commodity markets are expected to remain the primary driver of the continent's economic growth, but recent indicators show increasing diversification among the region's economies. According to the World Bank, this can be seen in foreign direct investment (FDI) flows, where the number of manufacturing and services investments is increasing. Rising investments and trade foster demand for air travel to and from the region.

Air travel network development

Consistent with economic growth, air travel demand to, from, and within Africa is forecast to outpace world average growth at 5.7 percent annually. Growth to and from other emerging markets is expected to lead the way, as airlines both in Africa and other emerging market regions are planning to increase inter-regional connectivity.

Prospects for intra-African growth are also rising. Airlines in the region are exploring new business models and development of intra-regional hubs. Growth in pan-African airline networks can bring the efficiency of air travel to the continent's transportation system. The flexibility of aviation networks and the relatively low cost per network kilometer make aviation infrastructure investment very attractive compared to investment in other modes.

Capacity to and from Europe will remain the largest single flow over the next decades, but long-term capacity growth will be slower than in other regions where trade and economic growth drive air travel demand more strongly.

Increased travel demand drives fleet growth

Africa is forecast to require close to 1,100 new airplanes over the next 20 years. Approximately 70 percent of forecast deliveries will support growth. Replacement of the existing aging fleet is also an important component of demand in Africa where the average in-service age of the fleet has declined by almost 20 percent since 2004. Single-aisle airplanes will account for the largest share of deliveries, while widebody airplanes will account for nearly half of the value of deliveries to Africa.