Despite progress on open sky policy, financial hurdles prevent African aviation from truly taking off, writes Arthur Shirichena.
Despite being home to 18 per cent of the world’s population, Africa represents only 2.2 per cent of global air traffic. Connectivity within Africa is poor, with the fragmentation of the regulatory environment rather than a lack of demand limiting aviation growth.
For thirty years, African aviation policy debates have largely been written in the language of legal freedoms. Policymakers and regulators frequently discuss the Yamoussoukro Decision and the Single African Air Transport Market (SAATM) as milestones in liberalising African skies. The central idea behind these initiatives is simple: remove regulatory barriers and airlines will be able to connect African cities more easily. Yet despite these reforms, air connectivity across the continent remains limited and expensive. Much of the discussion has focused on infrastructure gaps, regulatory constraints, or airline competition. But another, less visible barrier continues to shape the reality of African aviation: the movement of money. In many cases, aircraft can cross borders more easily than the payments associated with them, and this is holding the industry back.
The payment gap
Consider the position of an airline CEO operating in an African market. Legally, their airline may have been granted new rights to operate routes across the region. In principle, this should expand the airline’s commercial opportunities. In practice, however, the financial environment may constrain those opportunities. Passengers purchase tickets in local currencies such as Nigerian naira or Kenyan shillings. Yet many of the airline’s costs are denominated in foreign currencies. Aircraft leases, maintenance contracts, insurance payments and fuel purchases are often priced in US dollars or euros. When foreign exchange shortages or currency restrictions emerge, airlines may struggle to convert their local revenues into the currencies needed to meet these obligations. In some cases, airlines accumulate significant volumes of funds that remain trapped in local currencies and cannot be repatriated.
These funds exist on company balance sheets, but they cannot be used to pay international suppliers or aircraft lessors. For airlines operating on narrow profit margins, this creates a serious financial vulnerability. Routes that appear viable on paper quickly become unsustainable in practice.
Financial infrastructure constraints also affect passengers. Air travel is increasingly organised around digital booking systems and online payment platforms. These systems are typically designed around global card networks and formal banking infrastructure. However, large segments of African economies operate through informal or semi-formal financial systems. A trader may have sufficient cash to purchase a flight ticket but lack access to an internationally recognised payment card. A student may hold funds in a mobile money wallet that cannot be used on global airline booking platforms. In these situations, the passenger’s ability to travel is constrained not by airline availability but by payment system compatibility.
At the same time, global financial compliance frameworks such as anti-money laundering and know-your-customer regulations can unintentionally exclude individuals who work in informal sectors from accessing the banking systems required for online transactions. These dynamics highlight an important gap in aviation policy. Liberalising air transport markets creates legal access to aviation networks, but it does not necessarily ensure financial access to those networks.
A missing pillar of aviation integration
African aviation liberalisation has focused primarily on regulatory integration. However, financial settlement systems remain fragmented. As a result, airlines and passengers often operate within financial environments that are poorly aligned with the global aviation payment architecture.
Some policymakers and industry stakeholders have begun exploring ways to address this challenge. One proposal involves developing regional financial settlement mechanisms capable of supporting cross-border aviation payments while reducing exposure to foreign exchange volatility. Another involves improving interoperability between airline booking systems and African digital financial platforms, particularly mobile money services that are widely used across the continent. Such initiatives recognise that financial infrastructure is becoming a critical component of aviation governance.
The UK has a role to play
The United Kingdom is well positioned to contribute to this discussion. London remains one of the most important global centres for aviation finance and dispute resolution. Many aircraft leasing agreements and aviation financing contracts are governed by English law, and disputes are frequently resolved through London-based arbitration or commercial courts. At the same time, the UK maintains extensive aviation links with Africa, with Gatwick alone connecting 16 African destinations. London is a major hub connecting African cities to global markets, and British financial institutions remain deeply involved in aviation financing.
Given this position, the UK could help support efforts aimed at improving cross-border financial settlement in aviation. This could include facilitating regulatory dialogue between financial authorities, aviation regulators and payment system providers, as well as supporting institutional innovations that improve payment interoperability between African financial systems and global aviation settlement structures. Strengthening financial infrastructure would benefit both African aviation markets and the wider ecosystem of investors, financiers and service providers involved in the sector.
Moving beyond open skies
African aviation policy has long focused on opening airspace. But improving connectivity may increasingly depend on something less visible: ensuring that money can move as efficiently as aircraft. Aircraft may cross borders in hours, but financial systems often move much more slowly. Bridging that gap may prove essential for unlocking the full potential of African aviation integration.
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