African Airlines Face Bankruptcy as Royal Air Maroc Struggles Amid Pandemic

The current health crisis has spared no airline. Even the oldest ones are running out of steam and may not last long. Ranked a few months ago among the top five airlines on the continent, Royal Air Maroc is now on the brink of the abyss. More than a third of its fleet is grounded. Without waiting for the end of the health crisis, it has already embarked on an austerity plan to "limit the damage on its cash flow". 60% of the company’s traffic from Casablanca was to sub-Saharan African countries, all of which have locked down their airspace, francetvinfo recalls.

The tragedy of African airlines is that many of them were going through the desert before the Covid-19 crisis came to complicate the situation. This is the case of South African Airways, which has become a financial sinkhole, according to francetvinfo, which reports that Covid-19 is singing the requiem "of an airline that has been the pride of South Africa for decades". Heavily in debt, with more than a billion in losses over the past six years, well-informed sources point out "that it will soon disappear to make way for a completely restructured new company".

The African Airlines Association (AFRAA) fears the worst if African airlines do not receive support. "They will find themselves insolvent by the end of June," the association says. Even Africa’s leading airline, Ethiopian Airlines, "the pride of the Ethiopian economy, is struggling to survive". Since January, it has already lost more than $550 million and is now betting on freight and a few cargo flights to avoid sinking. However, its resilience capacity remains very limited if the crisis persists.

In Cameroon, the private company Camair-Co has taken the lead "by putting the majority of its staff on technical unemployment and hopes for government assistance to recover". The same scenario is playing out in Algeria with Air Algérie, which finds itself on the brink of bankruptcy "since all of its 56 aircraft have been grounded".

Whether it’s Kenya Airways, Air Mauritius, RwandAir or Air Sénégal, all of these airlines have seen their cash flow affected by the coronavirus pandemic. The Ghanaian Minister of Civil Aviation is calling for a "Marshall Plan" to save the African aviation sector. He will be supported by the International Air Transport Association (IATA), which is calling on states to invest to "save from shipwreck the ailing airlines that have never faced such a challenge".

According to its Secretary General, Abderahmane Berthé, between 2.5 and 3 billion euros will need to be raised through financial aid, or tax and fee relief, to save the African airlines threatened by the Covid-19 pandemic.