Africa cargo market huge but remains untapped: Study

Africa cargo traffic with China & India will see growth of 5.4% and 5.7%, respectively: Trade and Transport Group

Update: 2023-02-21 10:30 GMT
Click the Play button to listen to article

The Africa air cargo market is estimated at 2-2.5 percent share of the global market but that belies its enormous-yet-seemingly-elusive promise, says the latest study Africa Cargo Outlook 2023 by Trade and Transport Group, promoted by Tom Crabtree and Frederic Horst.

Crabtree, who retired from Boeing, and Horst, who was with Cargo Facts Consulting, says Africa’s working age population will exceed that of China by the early 2030s and that of India by the late 2030s.

"During the Covid-19 pandemic, the air transport capacity – particularly freighter aircraft – was re-oriented towards developed world markets in East Asia, Europe and North America, usually at the expense of developing world markets. Africa was hit particularly hard. While African passenger connections are being restored, freighter capacity is yet to return to pre-Covid levels."

The Africa-domiciled freighter fleet is small, and the major aircraft manufacturers see demand for 80-100 freighters, mostly in the narrowbody gauge. The upside, due to the nascent expansion of e-commerce networks, may be considerable, the report said.

Economy is another concern: while economic growth remains concentrated in a few African countries, "the overall economic outlook for the continent is one of accelerating growth in 2023 (3.8 percent) and 2024 (4.1 percent) with some mid-size African countries offering interesting growth opportunities."

African ExIm trade
While inbound African air trade is characterised by finished goods, IT equipment and automobile components, outbound air trade consists primarily of perishables including fresh fruits and vegetables as well as cut flowers. "The North-South focus on air cargo markets is changing towards a greater emphasis on cargo moving to and from Asia. African flower exports have underperformed compared to Latin American flower exporters. However, if national and regional export promotional efforts could be bolstered, it is conceivable that African producers could gain significant share compared to their competitors."

In general, Africa air cargo traffic with China and India will exhibit higher annual growth of 5.4 percent and 5.7 percent, respectively while cargo traffic with the biggest Africa trading partner, Europe, will grow more slowly at 3-3.2 percent per year. "Turkiye and the UAE also offer strong growth potential for Africa air trade, given the commanding Africa market presence of the airlines from those two countries."

Achieving the potential of African e-commerce has so far been elusive. E-commerce penetration is only around one percent but if players could emulate the practices of other markets (e.g. Latin America), the growth opportunity could be vast, the report added.

Click here to buy the report:

https://www.tandtgroup.net/africa-air-cargo-market-outlook/

Tags:    

Similar News