Good prospects for Africa-Asia cargo amid concerns over Sudan conflict

On the Africa-Asia trade route, cargo demand has increased significantly recently, but there are concerns about potential logistical issues due to the conflict in Sudan.

In April, IATA data showed that Africa was the only positive contributor as global airfreight demand fell and in particular freight en route from Africa to Asia increased by 20% yoy.

“Our monthly statistics show that there is enough capacity to meet rising air cargo demand in recent months,” said Bojan Wang, IATA economist at the industry analysis unit.

Since the Chinese market reopened in January, monthly flights to Africa have increased by 150% and flights from Africa to China by 146%. Mr. Wang expects this growing trend to continue throughout the year.

And the return of belly hold capacity was welcomed by shippers as freighter capacity was limited. Only a handful of operators like Ethiopian have their own fleet of freighters. However, there is a clear lack of Chinese freight capacity between the two regions.

A source at Ethiopian Airlines (ET) said: “We have sufficient capacity to connect and serve Africa and Asia through logistics services in air and sea-air modes. Going forward, however, partnership options (possibly with Chinese operators) will be explored in line with expected business growth and changing overall macro environment.”

ET shipments include fruits and vegetables and tech gadgets to and from Asia. According to the China Africa Research Initiative, the value of China-Africa trade in 2020 was US$176 billion, down from US$192 billion last year, due to supply chain disruption caused by Covid.

But even if demand between Asia and Africa is developing positively, there are concerns about political instability in countries like Sudan, which could lead to logistical problems.

“Sudan’s airspace is closed and supply chains in the region have been disrupted,” Mr Wang said. “Sudan is among the largest grain producers in Africa and the conflict could undermine efforts to increase wheat production there. As seen in Ukraine, the conflict in Sudan is likely to force air carriers to close or change operations, with knock-on effects on supply chains.”

Looking ahead, the main challenge and opportunity is to significantly increase Africa’s share of world trade and air freight activity, including balancing inbound and outbound cargo. This was a hot topic at the TIACA regional summit in Kenya last week.

IATA hopes its recently launched Focus Africa initiative will address the challenges in the African cargo sector.

“Currently, Africa accounts for only about 3% of world trade and 15% of intra-regional trade. Given that trade is a key driver of air cargo demand, weak trade performance in Africa is constraining air cargo activity in the region,” Mr Wang said.

According to IATA, Focus Africa aims to address challenges while finding solutions to boost cross-border trade and air cargo activity. Alternative modes of transporting goods on the continent are underdeveloped and challenged by a lack of adequate infrastructure, it said. This offers air cargo players an opportunity to improve the region’s capacity, connectivity and economic development.

Related Articles

Back to top button