Travel

Rwanda set to experience high growth in air travel

With major global carriers eyeing Kigali International Airport, is the existence of the national carrier threatened? The government of Rwanda has redoubled its efforts towards making tourism and foreign direct investments a priority for the economic development of the country. The results of these initiatives can be seen in the rapidly-changing business environment of Rwanda.

Limited access to Kigali is now a thing of the past, if we are to go by the number of flights operating in and out of Kigali International Airport. The list of new entrants is expected to grow exponentially, with this year alone projected to see another five major carriers enter the Rwanda air travel market. Apart from old timers like Kenya Airways, Ethiopian, and Brussels Airlines, KLM last year came in with five flights a week. South African Airways now flies into Kigali three times a week, Qatar Airways is scheduled to start Kigali Doha connections at six times a week from March this year. One might say easily that the national carrier is faced with major incoming competitor challenges in the face of an evolving air travel scenario.

Interestingly, while actively opening up the market and fully aware of the resultant effect, the government of Rwanda has been putting in equal effort in ensuring that the flag carrier, RwandAir, keeps punching above its height. Rapid fleet expansion and new destinations are just a few items of news that donned the media scenes last year. One of aviation’s most renounced personalities and former Ethiopian Airlines CEO, Mr. Girma Wake, now seats in Kigali as RwandAir’s Board Chairperson.

Sources within the industry affirm that a protectionist approach will slow down Rwanda’s rapid growth, while at the same time new entrants in the aviation scene might end up swallowing the national carrier. The government, however, has a completely different view on the subject; Rwanda is a double-landlocked country and air transport is one of the fastest means for connectivity to the rest of the world. This means that more and more airlines are welcome to fly to Kigali if it fits their business model. At the same time, Africa must nurture its local carriers to limit overdependence on foreign carriers.

With a population of only 2,262,000 in an area of 4,114 km2, Dubai International Airport handled more than 50 million passengers in 2011. Emirates, their national carrier, uplifted three quarters of these passengers. Going by these statistics, it is clear that the flying population of Rwanda alone will not sustain the investment being done by RwandAir. However, with clear origins and destinations planning, the national carrier can succeed in hubbing Kigali, thereby fitting in the national development agenda.

In a press conference with RwandAir CEO, Mr. John Mirenge, he affirmed the national carrier’s position in the emerging scenario. “Last year Kigali International Airport handled over 320,000 passengers, out of which, 50 percent traveled on RwandAir. Our passenger numbers January 2010 stood at a paltry 6,000; the numbers more than doubled to 13,000 last January. This year January, we uplifted 25,000 passengers - a sharp increase over the same period last year. New entrants are very much welcome. It is the only way we will grow the air travel market in this country,” Mirenge said. He added that healthy competition would give the traveler options and put the onus on operators to work hard and smart to retain customers.

“You will have to keep in mind the fact that most of the carriers coming into Kigali have been at this business for a long time. We have to measure up and surpass our customer expectations in terms of our service delivery,” added a beaming John Mirenge, who was very modest with the airline’s achievements since last year. “Of course as a home airline, we are open and willing to enter into meaningful and mutually-benefitting partnerships with other carriers. But such agreements must be a tangible benefit to either partners involved,” he added.

From two brand-new Boeing Sky Interior aircraft – first on the African continent, with four new routes on the continent, and Dream Miles, a mile-based frequent flier program to the more recently launched online booking engine with credit card payment facilities - Mr. Mirenge says these are not extras but basic air traveler expectations. RwandAir became the first local organization in Rwanda to enter into the e-commerce retail market to distribute its products and acquire money online.

While operators are digging in to buy market share, airport authorities on the other hand are smiling all the way to the bank from extra income arising from every time there is a landing and take-off from Kigali International Airport. Industry analysts predict that initially, air travelers are likely to see heightened fare competition to common destinations, however, the long-term effect will be more responsiveness from airlines in terms of service delivery, on-time performance, and in-flight service, among other items.

Sources at the Rwanda Development Board say the ideal number of inbound and outbound travel must exceed a million passengers per year within the next few years if economic drivers of the transport industry are to make meaningful contribution to the growth of Rwanda.

Image via travelhouseuk.co.uk

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