John Bosco Kalisa, chief executive officer for the East African Business Council (EABC) issued this appeal in a validation webinar for a study on air transport services liberalization in the EAC zone.
It was organised in partnership with TradeMark East Africa (TMEA) and the support of the Netherlands, airing the view that stakeholders are concerned that limited liberalisation of air transport services retains high flight ticket rates.
Visa restrictions limit the movement of non-residents into the EAC bloc, the EABC chief noted, appealing to the Heads of State to adopt a single area model offering preferential and national treatment for EAC airlines.
This is currently the case in some countries, where foreign airlines enjoy more favourable treatment than EAC airlines, he stated, noting that the region can start offering preferential treatment to EAC cargo planes to boost exports.
The study analysed the cost drivers and regulatory environment, including taxes, levies and other related charges, listing recommendations to lower the cost of air transport in the region.
Limited infrastructure, lack of standardised regulations and high air transport costs are key challenges for air transport in the EAC zone, he said, arguing that the EAC should consider replacing bilateral air services agreements now in place with a single area air transport services.
EAC partner states need to fast-track EAC regulations on the liberalisation of air transport services in line with the EAC Common Market Protocol, he asserted, citing preliminary findings of the study as showing that one percentage increase in passenger traffic enhances tourism receipts.
Similarly, a percentage increase in freight carrier departures leads to a 0.299 percent increase in tourism receipts.
One percentage increase in air passenger traffic leads to a minute increase in the gross domestic product (GDP), while the combined impact in trade, tourism, inbound investment, production and employment would result in an additional 46,320 jobs and $202.1m gross income annually, he elaborated.
Paveen Mbeda, TMEA head of public-private dialogue and export capability underlined that partnering with public and private sector actors to unlock bottlenecks and facilitate trade in the EAC and the continent was a priority.
Air transport costing is an enabler of tourism and export of horticulture, thus contributing to EAC’s GDP outcomes and building foreign reserves, he said.
Charles Omusana, principal economist for investment and private sector promotion at EAC headquarters said that liberalization of air transport services will contribute to the greatest desire of growing intra-EAC trade.
The preliminary findings also show that cargo volumes have largely stagnated in the EAC region due to high costs of air cargo, he stated.
The lengthy bureaucracy involved in obtaining clearance coupled with some airlines' scheduling delays and inadequate infrastructure like cold rooms and route restrictions made it difficult to access new markets, he added.
