Institutional investors should consider providing funding and support to African airlines demonstrating good governance and leadership.
African airlines require improved governance and stronger leadership to expand and attract funding. This was the main takeaway from Vijay Poonoosamy, Barrister and Partner at Dentons Mauritius, at the recent African Aviation Summit in Johannesburg. Poonoosamy moderated a panel on ‘Aircraft Fleet Considerations & Legal Perspectives’ and participated in the closing session titled ‘The Way Forward – Positioning for Growth’.
“Our continent’s national leaders must exhibit their commitment to their respective national interests with integrity and empower government-owned African airlines to be efficiently managed by professionals,” stated Poonoosamy. “Those national leaders who choose to do so will enable these airlines and related aviation government entities to thrive, consequently propelling their countries forward.”
Shahid Sulaiman, Senior Partner and Head of Corporate of Africa at Dentons, added that countries fostering such a conducive environment for their airlines will enhance their chances of securing favorable terms for aircraft and financing. These factors are crucial for providing the much-needed intra and inter-continental air connectivity in Africa.
The 32nd edition of the summit focused on the funding challenge faced by African airlines – both existing carriers and start-ups. International and African financial experts, in addition to senior officials from leading African airlines, deliberated on the current scenario and explored practical solutions.
Poonoosamy emphasized that financial institutions and investors should contemplate offering funding and support to African airlines, particularly those showcasing good governance and leadership.
“With a growing number of companies globally embracing ESG principles and the necessity to excel in both performance and social responsibility, I urge aircraft vendors, lessors, and financiers to provide well-managed African airlines with attractive terms or even better terms than those extended to profitable airlines elsewhere,” articulated Poonoosamy.
Sulaiman highlighted the interconnectedness between Africa’s socio-economic status and its aviation sector. “Africa’s socio-economic status is not at its optimal level, and subsequently, African civil aviation also suffers. This correlation is significant,” mentioned Sulaiman.
“Outstanding governance and effective leadership will facilitate the establishment of safe, secure, viable, and sustainable African airlines, thereby fostering African socio-economic growth and contributing to a positive cycle for these airlines,” Sulaiman explained.
“The success and longevity of African airlines rely on robust leadership and governance,” concluded Poonoosamy. “Government officials should strive to implement policies that nurture strong governance and leadership within the aviation sector. Financial institutions and investors, on the other hand, play a pivotal role by offering essential funding and backing to airlines demonstrating sound governance and leadership. This, in turn, will drive the crucial socio-economic development needed for the continent’s overall advancement.”