New Telegraph

African airlines to post $638m losses in 2022

… Macro-economic headwinds make connectivity complex in Africa – IATA

Despite economic uncertainties, the International Air Transport Association (IATA) has said there are plenty of reasons to be optimistic about 2023, predicting that it expects a return to profitability for the global airline industry as airlines continue to cut losses to their business in 2022 stemming from the effects of the COVID-19 pandemic.

IATA disclosed that in 2023 the airline industry is expected to tip into profitability as carriers are anticipated to earn a global net profit of $4.7 billion on revenues of $779 billion (0.6% net margin). This expected improvement comes despite growing economic uncertainties as global Gross Domestic Product (GDP) growth slows to 1.3 per cent (from 2.9 per cent in 2022).

In the same vein, African airlines are expected to post a loss of $638 million in 2022, narrowing to a loss of $213 million in 2023. Passenger demand growth of 27.4 per cent is expected to outpace capacity growth of 21.9 per cent.

According to IATA, the clearing house for over 290 global airlines, cumulatively, in 2023, airlines are expected to post a net profit of $4.7 billion – a 0.6 per cent net profit margin, adding that it is the first profit since 2019 when industry net profits were $26.4 billion (3.1per cent margin).

In 2023, airline net losses are expected to be $6.9 billion (an improvement on the $9.7 billion loss for 2022 in IATA’s June outlook). This is significantly better than the losses of $42.0 billion and $137.7 billion that were realised in 2021 and 2020 respectively.

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