The 4th AFRAA fuel tender for 2015 fuel supply was successfully finalized with the member airlines achieving significant savings of $29m. Thirteen Airlines committed volumes of over 1.2 billion litres in 169 locations with 51 suppliers participating. South Africa Airways joined the project and included all the Africa locations. The project now has the major carriers in the Continent and is set to grow to higher heights.
The Tender Evaluation criteria included the following:
Transparent Pricing basis
Insurance cover of $1billion
Payment terms and Commercial terms
Adherence of regulatory requirements
The AFRAA Fuel project has been successful over the years due to the unique qualities of the member airline representatives, who have formed a strong working group drawing synergies from their diverse skills and cultural backgrounds.
The team attended the 2014 IATA Fuel Forum in Dubai and had the opportunity to meet both existing and potential fuel suppliers who are important stakeholders for the Project. The team received very positive feedback regarding the Project’s tender process from the suppliers and looks forward to the next tender which will see the Project celebrate its 5th anniversary. .
The AFRAA Ground handling Committee met in Nairobi on 02 February 2015 at the AFRAA Head-quarters in Nairobi. Welcoming dele-gates to the meeting, AFRAA Secretary General Dr. Elijah Chingosho underlined the importance of the project noting that airlines in Africa face many challenges, among which are high industry costs. He commended the committee on conducting its inaugural tender for the procurement of ground handling services at various stations in Africa and pledged his full support towards the initiatives of the Project.
The meeting reviewed the activities of its inaugural tender process which was carried out in 2014. Members took stock of valuable feedback was received from ground handlers through a survey carried out by the Secretariat. The meeting deliberated at length its action plan for 2015 which will cover the following areas:
Training and capacity building
2015 tender process
The meeting was chaired by Mr. Mpho Phillip Sekhamane, Head of Department: Global Operations Control Centre - South African Airways and was attended by 11 delegates from AFRAA airlines. Mr. Sekhamane commended the members for their participation and dedication which had seen the Project kick off its activities in 2014. He urged members to keep up the spirit for the success of the Project.
AFRAA Secretary General, Dr. Elijah Chingosho and IATA Regional Vice President - Africa & Middle East, Mr. Hussein Dabbas at the AFRAA Headquarters in Nairobi – 26 January 2015
IATA Regional Vice President for Africa & Middle East, Mr. Hussein Dabbas, accompanied by IATA Vice President for Africa, Mr. Raphael Kuuchi and their team met the AFRAA Secretary General, Dr. Elijah Chingosho and his team, on 26 January 2015 at the AFRAA Headquarters to discuss priority areas for 2015 where both Associations will collaborate for the support of African airlines and the development of air transport in the continent.
Speaking at the opening of the meeting, Mr. Dabbas thanked AFRAA for its continued support to IATA’s activities and efforts, most recently being the launch of the Benefits of Aviation Report in Addis Ababa, Ethiopia on 12 January 2015. Mr. Dabbas briefed the meeting on the achievements realized by IATA in 2014 and presented the Association’s strategic objectives for the region for 2015.
On liberalization, AFRAA Secretary General applauded IATA for the study which it had commissioned on the benefits of liberalization in Africa. He informed the meeting that the regulatory texts required for full implementation of the Yamoussoukro Decision had been finalized in 2014 and acknowledged the current momentum for the full liberalization of African skies. Following up on the outcome of the Ministerial Working Group Meeting which took place in Pretoria –South Africa in January 2015, Mr. Raphael Kuuchi expressed the need for stakeholders to work with the African Union to come up with practical steps to be taken for the opening up of African skies. He said, “As the key industry players, IATA will work together with AFRAA and other stakeholders till we see that Africa is fully liberalized.”
With regards to fuel costs in the continent, the meeting noted that fuel prices in many stations in Africa were still high in spite of the current drop in world oil prices. Subsequently, airline fares remained relatively unchanged. This was because some airlines had hedged their fuel prices and it was going to take a bit of time to realise the benefits of the drop in world oil prices. Also, the high taxes, fees and charges on fuel continue to keep fuel prices in Africa well above the world average. On lobbying for the reduction of industry costs in the continent, fuel was identified as one of the key focus areas where for example, many Governments in Africa don’t apply market-based pricing resulting in very high costs.
Both IATA and AFRAA will be represented at the following forthcoming industry Conferences/Workshops that the respective teams are preparing to organize:
•Passenger experience workshop (IATA), 6-7 May 2015
•IATA Middle East and Africa Aviation Days, 24-25 March 2015 – Abu Dhabi
•Aviation Stakeholders’ Convention (AFRAA), 28-30 April, Johannesburg – South Africa
•IATA Africa and Middle East Aviation Days, 22-23 June 2015, Nairobi – Kenya
Among other issues, the meeting discussed the following priority areas for cooperation and collaboration in 2015:
•Lobbying for reduction of industry costs and monopolies especially in ground handling
•Lobbying for the full implementation of the Yamoussoukro Decision, MC99 and Montreal Protocol on unruly passengers
•Safety including e-IOSA
Mr. Dabbas reassured AFRAA of IATA’s dedication to continue working together with AFRAA. “There are many issues where both Associations can and are working together for the support of the industry” he said. On his part, Dr. Chingosho added that by collaboration, AFRAA and IATA are able to achieve more towards the development of the air transport industry.
Also present from IATA were: Mr. Hassim Pondor - Africa Head – Airport, Passenger, Cargo & Security (APCS) and Ms. Sally Osure –Area Manager – East Africa and Mr. Philip Friese – Regional Head, People, Performance & Development, Africa and Middle East. Present from the AFRAA Secretariat were: Dr. Koussai Mrabet, Director, Commercial Corporate and Industry Affairs, Mrs. Juliet Indetie - Deputy Director, Corporate Finance and Administration and Ms. Maureen Kahonge – Business Development Manager.