Investors urge East Africa to liberalize air transport services to boost trade

Liberalization of air services in the EAC region will increase traffic volumes, improve connectivity and lower air transport fares

Nairobi, Kenya | Xinhua | The East African Business Council (EABC), a regional trade lobby, on Wednesday urged the East African Community (EAC) partner states to liberalize the air transport services to spur intra-regional trade.

The EABC is the regional apex body of the private sector in the EAC member states of Kenya, Uganda, Tanzania, Burundi, Rwanda and South Sudan.

John Bosco Kalisa, CEO of EABC said that the domestic air transport sector remains protected, reducing accessibility and increasing air transport cost at the expense of potential users.

“Liberalization of air services in the region is set to increase traffic volumes, improve connectivity and lower air transport fares. This will in turn increase trade and tourism, inward investment and productivity growth,” Kalisa said in a statement.

According to findings from the latest policy paper by EABC, Costs and Benefits of ‘Open Skies’ in the EAC region, air-transport liberalization is set to lower flight costs by nine percent and result in a 41 percent increase in flight frequencies.

The policy paper recommends for the EAC partner states to provide subsidies for the aviation industry in the form of direct financial support, loan guarantees, corporate bonds and tax reliefs.

“By removing foreign restrictions, EAC partner states will be able to attract private sector investment. This will open up access to capital and avail investment in infrastructure upgrades and capacity expansion for regional airports,” Kalisa added.

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Xinhua