Aviation
Local businesses should capitalize on Africa’s rising opportunities – DHL
CAPE-TOWN – Due to Africa being home to seven of the 10 fastest growing economies in the world, the continent is fast becoming top of mind for many global businesses.
The Ernst & Young 2014 Africa Attractiveness survey last week revealed that Africa has become the second-most attractive investment destination in the world, up from the third-from-last position in 2011. In 2013, Africa’s share of global foreign direct investment (FDI) projects reached 5.7%, its highest level in a decade.
Rahavendra says, “The rise of Africa has been well documented over the past decade and has now become one of the biggest frontiers for trade and investment.” He points to recent figures by the International Monetary Fund (IMF), which also tell the story of Africa rising. Its latest Regional Economic Outlook: Sub-Saharan Africa (SSA) April 2014, revealed that real GDP growth in SSA is forecasted at 5.4% this year.
He adds that this overall economic growth forecast is surpassed by many of the African countries prospects, especially low-incomes states, such as Rwanda and Sierra Leone, which are projected to grow by 7.5% and 13.9%.”
The 2014 Africa Attractiveness survey revealed that South Africa remained the largest destination for FDI projects, however, countries such as Ghana, Nigeria, Kenya, Mozambique, Tanzania and Uganda, have become more prominent on investor’s radars.
For example, FDI projects in Mozambique grew at a compound annual growth rate (CAGR) in excess of 30% since 2007. In 2013, Mozambique received 33 FDI projects, up 32% from the previous year. While coal deposits and offshore gas fields attract investors, infrastructure projects are another focus, with the country currently having more than US$32 billion worth of active infrastructure projects. A key focus area of these projects include developing road and rail transport networks to link the country’s coal reserves to the main corridors, as well as expanding port facilities.
Although FDI projects into Angola declined in 2013, the country remains the fourth-largest recipient of FDI. The country is focused on increasing its infrastructure, especially airports and ports, to meet its aim of US$4b in non-oil investments by 2017.
Rahavendra adds that the discussion of foreign investment often overlooks the real potential of Africa, namely its people and businesses. “Many local entrepreneurs and small and medium enterprises (SMEs) have so much to offer to their respective countries, both in terms of services and sustained economic growth.”
As economies grow in Africa, as will the demand for its services, and this demand will offer numerous opportunities to inspired entrepreneurs. “As household expenditure has increased over the years, resulting in rising consumer demand, there is a definite opportunity for SMEs to fill the gaps which are not being serviced by large global companies. We have over 25,000 SMEs who work with us across Africa and every day we work on understanding their needs better and help them to go global”.
The express company is doing significant work in increasing connectivity for SMEs, helping them to understand the paperwork, legislation and expertise needed to grow beyond borders.
“We are increasingly noticing retail and telecommunication customers expanding on the continent and local entrepreneurs should be encouraged to also capitalize on the continent’s growing markets, similar to the approach by international organizations. We as DHL Express have increased our retail presence in Sub Saharan Africa to just over 2600 outlets. Other sectors where we have seen growth include fast moving consumer goods, health care products, retail, food, telecommunications and other consumer related necessities.”
Rahavendra adds that the continent’s competitiveness can be hindered in terms of growing the flow of goods within the continent itself. “With underdeveloped road and rail networks, and around 12% of cities served by just one flight per week, infrastructure and connectivity are among the most pressing challenges. Investments in infrastructure and our network remain a key focus area for us in 2014 as we understand that in order to achieve growth, we need to ensure that we have the best in class facilities. The ongoing upgrades to our network operations assist us in meeting these expectations while maintaining our excellent service standard”.
“Extensive infrastructure is critical for ensuring the effective functioning of an economy and a well-developed network is vital for enabling local and global business to transport their goods and services to the market securely and timely. As a logistics service provider, DHL remains committed to not only connecting others to one of the world’s biggest frontiers, but to making the rest of the world the next frontier for Africa,” concludes Rahavendra.
Shell Nigeria Exploration and Production Company Limited (SNEPCo) has welcomed efforts to promote safe helicopter services across Africa in a proposed Regional Action Plan (RAP).
The plan, according to a company statement, is the highlight of a workshop organised in Lagos within the week by the Aviation subcommittee of the International Association of Oil and Gas Producers (IOGP) in partnership with London-based safety advocacy group, HeliOffshore.
Biztellers reports that the two-day Offshore Helicopter Industry Safety Workshop (OHISW) with the theme “Developing a Regional Action Plan,” followed on from a similar session last year which SNEPCo sponsored.
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It also provided administrative and logistical support for this year’s conference which was sponsored by ExxonMobil. SNEPCo, which pioneered Nigeria’s deepwater production at Bonga in 2005, relies on helicopter shuttles for operations and supports the workshop as part of its contributions towards safe services in Nigeria.
In an address at the opening session delivered by General Manager Contracting and Supply Chain, Charles Oranyeli, Managing Director SNEPCo, Ronald Adams said: “By developing a regional action plan, we can move beyond dialogue to alignment, ensuring that the safety leadership, industry standards, and collaborative approaches championed last year are embedded in a common roadmap for collective improvement. The most effective solutions will come not from isolated efforts, but from partnership, standardization, and coordinated action across the region.”
The workshop was attended by more than 80 representatives from oil and gas companies, the Nigerian Content Development and Monitoring Board (NCDMB), the Nigeria Civil Aviation Authority (NCAA), the Nigerian Safety Investigation Bureau (NSIB), helicopter operators and original equipment manufacturers.
The event concluded with participants deciding action items for the proposed Regional Action Plan including Search and Rescue (SAR) initiatives, implementation of IOGP Report 690 standards and establishment of formal industry leadership forums.
The IOGP has been active for over 50 years, supporting its more than 90 members around the world to promote “excellence in safe, efficient and sustainable energy.”
The Airline Operators of Nigeria (AON) has declared that airlines operating in Nigeria have come under financial pressure following a sharp increase in the price of Jet-A1, also known as aviation fuel.
According to the group, the price of aviation fuel, has surged to about N1,800 per litre in many parts of the country, from about N1,000 per litre two weeks ago. This amounts to almost an 80 per cent increase within a short period.
Aviation fuel remains the largest cost component in airline operations, accounting for about 30 to 35 per cent of total operating expenses.
Industry stakeholders have linked the latest spike to the ongoing conflict in the Middle East, which has pushed up global energy prices.
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Speaking on Channels Television on Friday, the spokesperson for the Airline Operators of Nigeria, Prof Obiora Okonkwo, said the surge had placed airlines under severe financial strain.
According to him, most carriers have so far refrained from immediately transferring the additional cost burden to passengers, despite the pressure on their operations.
“Two weeks ago, we were getting Jet-A1 at about N1,000 per litre, which today is about N1,800, and even more in some stations. We have experienced an increase of about 80 per cent. That’s quite a spike,” Okonkwo said.
He explained that airlines were currently absorbing the losses in order to avoid worsening the economic burden on the travellers.
“We are not in a business where you can easily adjust your ticket price. Right now what we are doing is that we are bleeding. We are taking the blow. We are selling tickets at very non-profitable prices. We are losing a lot of money,” he said.
Okonkwo warned that the situation might not be sustainable if fuel prices continue to rise without government intervention.
“Obviously, adjustments will be expected anytime soon. But again, we are very sensitive to the economic situation of Nigerians and our travellers,” he added.
He noted that developments in the global oil market, particularly the recent release of reserve crude oil, could influence fuel prices in the coming weeks.
Okonkwo also urged the Federal Government to explore engagement with the Dangote Refinery as part of efforts to stabilise aviation fuel supply locally.
“We were more hopeless in a situation where there was no refinery in Nigeria in the last two years. Now that we have a refinery, we are hopeful that we can find a solution around it,” he said.
According to him, if the spike persists, some airlines may struggle to continue absorbing the losses associated with the rising cost of aviation fuel.
Meanwhile, the AON spokesperson also reacted to the decision by the Federal Competition and Consumer Protection Commission to sanction about five airlines over alleged price fixing.
Okonkwo said while the commission has regulatory powers, the aviation sector remains deregulated, making coordinated price fixing unlikely.
“There is no meeting of airlines where they agree to fix prices. Fixing prices would mean operating as a cartel, and that is not the case,” he said.
He explained that airline ticket pricing varies widely because different aircraft types attract different operating costs.
“Each airline determines its fares based on its own operational costs,” he said.
Okonkwo added that airlines must also demonstrate financial viability to regulators as part of the conditions for maintaining their operating licences.
“At every point in time, you must prove to the regulators that you are financially viable and capable of sustaining operations,” he said.
He urged regulators to take into account the fragile nature of the aviation industry when making policy decisions affecting airlines.
An Air Peace flight from Lagos to Port Harcourt has suffered a disruption, after the aircraft was affected by a bird strike on arrival at the Port Harcourt International Airport.
The airline made the disclosure on Thursday in a statement signed by its spokesperson, Osifo-Whiskey Efe.
He added that the incident necessitated safety checks on the affected aircraft and the deployment of another aircraft to convey passengers on subsequent flights.
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“We deeply empathise with passengers affected by this unforeseen incident and are working diligently to minimise disruptions,” Efe said.
The latest incident adds to the growing challenge of bird strikes faced by local airlines.
In December 2025, Air Peace disclosed that it recorded 49 bird strikes across Nigeria between January and September, stressing that even a single strike could ground an aircraft for weeks.
Chairman and Chief Executive Officer of the airline, Allen Onyema, had said on Arise TV that bird strikes constituted a major operational challenge, often leading to costly repairs and serious disruptions to flight schedules.
“One bird strike could cripple your aircraft for the next month. At that moment, there is no two ways about it. These bird strikes often lead to costly delays and serious disruptions in flight schedules,” he said.
He added that losses from such incidents compound other challenges facing Nigerian airlines, including heavy taxation and operational constraints.
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