A growing number of African carriers armed with coherent business plans and stronger balance sheets are attracting interest from financiers, banks, traders and lessors, both from the continent and globally.
Over the past couple of years there has been a major change in sentiment toward doing business with African airlines, according to Raphael Haddad, president of brokerage Jetcraft Commercial, speaking to Aviation Week.
“We have noticed that financial institutions have become increasingly open to conduct aircraft financing in Africa,” he says. In the past, financiers have shied away from African airline business as the risk was deemed too high.
Jetcraft, which conducted about 20% of its aircraft trading business in Africa, established a credit facility through pan-African banking firm Absa Group in 2023 to support aircraft transactions, Haddad says.
Jetcraft is seeking to expand its activities with more African financial institutions, as it has with Absa. “This is important, but the bigger point is that airlines in Africa are finding easier access to financing and becoming interesting to lessors and African banks,” he notes.
“It is a turning point because more African airlines have become more robust,” Haddad says. “Many have been able to develop their operations to become profitable and solid businesses. Many are gaining independence from governments, giving them strength and independence in making decisions.”
African carriers such as South Africa’s FlySafair and Airlink, Nigeria’s Overland Airways and Air Peace, Gabon’s Afrijet and Angola’s TAAG are some of those catching the eye of finance institutions or lessors seeking to do business on the continent.
“This is good news as more African airlines become financeable, the more opportunities there are to place aircraft. Some airlines can pay cash, but if they need financing, we are now seeing the appetite to deliver that financing,” Haddad says.
Last year, Jetcraft expanded its trading facility with Absa to include a leasing support agreement. This allows the company, which focuses mainly on trading aircraft, to enter deals where leases are attached to the aircraft, he notes.
“This allows aircraft to be placed on long-term debt structures to support operating or finance leases. It gives us more flexibility as we are seeing more deals that require this approach on the cards,” Haddad says. “The plan this year is to increase our leasing capacity in partnership with Absa.”
In terms of trading activity, Jetcraft focuses on trading of regional and single-aisle narrowbody aircraft while acting as a broker for widebody deals. “The market generally is very dynamic right now, there’s a greater propensity to acquire aircraft, whether it’s on lease or as an acquisition.”
