International routes beneficial
The local tourism industry benefits greatly because of Air Namibia's international flights, an Oxford economics researcher has said.
Namibia stands to benefit greatly if Air Namibia continues to make outbound flights, says Oxford economics researcher Ian Mulneirn.
He made the comment during a recent stakeholder engagement by the airline. According to him, a large number of visitors would be unable to travel to Namibia if the airline cancelled its international routes. It would also have ripple effects on not just the economy but the tourism sector as well. Giving an example of what would happen if Air Namibia cancelled its Johannesburg route, Mulneirn said: “In 2015-16, Air Namibia transported 136 746 passengers along its Windhoek–Johannesburg–Windhoek route. If Air Namibia did not exist, around 61 900 of these could have been accommodated on other carriers' direct flights, assuming they are filled to 100% load factor.”
Mulneirn indicated that if Air Namibia were to cancel its Johannesburg leg, an estimated 74 800 passengers would be affected.
“The remaining 74 800 passengers of Air Namibia's passengers would have to choose between a range of indirect route options. While the existing aviation network could have accommodated Air Namibia's near 475 000 passengers in 2015-16, they would have faced higher journey costs, especially in the case of indirect options,” he said.
Giving examples of what would happen if Air Namibia were to cancel its Frankfurt route, he said only 313 passengers would be able to fly directly to Hosea Kutako International Airport while 117 913 passengers would be forced to fly indirectly.
On the Cape Town route, only 1 589 passengers would be able to fly directly to Namibia while 98 058 passengers would be forced to fly indirectly. Of the 53 712 passengers who fly directly from Luanda, Angola, only 12 310 would be able to fly to Namibia directly.
According to him, because Air Namibia operates, journeys into Namibia decline by nearly 50%. “We estimate that of these 475 000 passengers, fewer than 250 000 would undertake the same journey if the airline did not exist.”
As a result, the tourism industry would take a serious knock if Air Namibia's international routes were to be scrapped, Mulneirn said.
“The reduction in passenger numbers means fewer visitors arriving in Namibia, and a substantial drop in the economic impact of tourism facilitated by Air Namibia.”
Because of its international flights, Air Namibia has also made notable contributions to the economy, Mulneirn attempted to show, with the airline making a N$704 million contribution to the Gross Domestic Product (GDP), generating 4 550 jobs and making payments of N$316 million in tax receipts.
Said Mulneirn: “The airline's contribution to the economy extends far beyond this impact, the connectivity provided by Air Namibia boosted productivity by N$1.4 billion in 2015/16.Tourism facilitated by the airline contributed a further N$971 million to GDP, 4 400 jobs, and N$245 million in tax receipts.”
Mulneirn also forecast good growth for Air Namibia, saying that because of international flights, it had the ability to generate up to 6 300 jobs while it could pay up to N$463 million in tax receipts by the year 2020.
Of its estimated contribution to the tourism sector, Mulneirn said: “We see a further N$1.7 billion contribution to GDP, 7 700 jobs in the tourism sector and N$440 million in tax receipts from tourism facilitated by the airline.”
Concluded Mulneirn: “This analysis underlines the importance of Air Namibia to the Namibian economy. A fact further highlighted by our estimation how the economy would suffer in the absence of Air Namibia.”
Following Mulneirn's presentation, Air Namibia spokesperson Paul Nakawa said the research conducted by Mulneirn was unsolicited.
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He made the comment during a recent stakeholder engagement by the airline. According to him, a large number of visitors would be unable to travel to Namibia if the airline cancelled its international routes. It would also have ripple effects on not just the economy but the tourism sector as well. Giving an example of what would happen if Air Namibia cancelled its Johannesburg route, Mulneirn said: “In 2015-16, Air Namibia transported 136 746 passengers along its Windhoek–Johannesburg–Windhoek route. If Air Namibia did not exist, around 61 900 of these could have been accommodated on other carriers' direct flights, assuming they are filled to 100% load factor.”
Mulneirn indicated that if Air Namibia were to cancel its Johannesburg leg, an estimated 74 800 passengers would be affected.
“The remaining 74 800 passengers of Air Namibia's passengers would have to choose between a range of indirect route options. While the existing aviation network could have accommodated Air Namibia's near 475 000 passengers in 2015-16, they would have faced higher journey costs, especially in the case of indirect options,” he said.
Giving examples of what would happen if Air Namibia were to cancel its Frankfurt route, he said only 313 passengers would be able to fly directly to Hosea Kutako International Airport while 117 913 passengers would be forced to fly indirectly.
On the Cape Town route, only 1 589 passengers would be able to fly directly to Namibia while 98 058 passengers would be forced to fly indirectly. Of the 53 712 passengers who fly directly from Luanda, Angola, only 12 310 would be able to fly to Namibia directly.
According to him, because Air Namibia operates, journeys into Namibia decline by nearly 50%. “We estimate that of these 475 000 passengers, fewer than 250 000 would undertake the same journey if the airline did not exist.”
As a result, the tourism industry would take a serious knock if Air Namibia's international routes were to be scrapped, Mulneirn said.
“The reduction in passenger numbers means fewer visitors arriving in Namibia, and a substantial drop in the economic impact of tourism facilitated by Air Namibia.”
Because of its international flights, Air Namibia has also made notable contributions to the economy, Mulneirn attempted to show, with the airline making a N$704 million contribution to the Gross Domestic Product (GDP), generating 4 550 jobs and making payments of N$316 million in tax receipts.
Said Mulneirn: “The airline's contribution to the economy extends far beyond this impact, the connectivity provided by Air Namibia boosted productivity by N$1.4 billion in 2015/16.Tourism facilitated by the airline contributed a further N$971 million to GDP, 4 400 jobs, and N$245 million in tax receipts.”
Mulneirn also forecast good growth for Air Namibia, saying that because of international flights, it had the ability to generate up to 6 300 jobs while it could pay up to N$463 million in tax receipts by the year 2020.
Of its estimated contribution to the tourism sector, Mulneirn said: “We see a further N$1.7 billion contribution to GDP, 7 700 jobs in the tourism sector and N$440 million in tax receipts from tourism facilitated by the airline.”
Concluded Mulneirn: “This analysis underlines the importance of Air Namibia to the Namibian economy. A fact further highlighted by our estimation how the economy would suffer in the absence of Air Namibia.”
Following Mulneirn's presentation, Air Namibia spokesperson Paul Nakawa said the research conducted by Mulneirn was unsolicited.
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