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Liberalization of Air Transport in the EAC Contributes $202 Million per annum in GDP

Posted 14 May 2017 · Add Comment

Air transport liberalization within the East African Community (EAC) could earn the region 202.1 million U.S. dollars in gross domestic product (GDP) annually, reports Hillar Muheebwa

This is according to a new study report, Costs and Benefits of Open Skies in the East African Community. The report was commissioned by the East African Business Council (EABC) and the East African Community (EAC) Secretariat.
EABC meeting to validate the findings of the Study took place on Wednesday 10th May, 2017 at Hilton Hotel, in Nairobi, Kenya.
The study said the airspace liberalization among Tanzania, Kenya, Uganda, Rwanda and Burundi could also result in an additional 46,320 jobs.
The study focuses on the impact of implementing the Yamoussoukro Decision (YD) in East which among other things, call for African countries restrict their air services markets to protect the share held by state-owned air carriers.
The Yamoussoukro Decision was adopted in Yamoussoukro, Côte d'Ivoire on 14 November 1999. It promised to create a single air transport market across Africa by 2002, tearing down existing bilateral regimes. It was signed by 44 member states of the African Union, but has never been operationalised.
Study analysis reveal compelling evidence that full liberalization of restricted routes leads to 9% lower average fares and a 41% increase in frequencies, which in turn stimulate passenger demand.
"The study analysis demonstrates that increased air service and traffic resulted in positive benefits for the total EAC economy," said Lilian Awinja, EABC chief executive officer.
She urged EAC member states to harmonize air transport regulations specifically taxes across the region and finalize the EAC Liberalization of Air Transport Regulations also fully implement Yamoussoukro Decision.
 

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