March 4, 2020 / 12:42 PM / 24 days ago

African airlines face $40 million hit in 2020 from coronavirus

ADDIS ABABA (Reuters) - Coronavirus disruption could cost African airlines $40 million in revenue this year, a global industry body said on Wednesday, a potentially devastating hit to often struggling airlines counting on lucrative Chinese routes to fund expansion.

Airlines around the world have suspended or modified flights after the outbreak of the COVID-19 coronavirus, which began in mainland China late last year and has now spread to more than 60 countries around the world.

The global hit to the aviation industry is projected to be $29 billion this year - a 4.7% industry-wide drop in revenue per passenger kilometer, the International Air Transport Association (IATA) has said.

The blow to African airlines could be as much as $40 million, IATA’s special envoy to Africa, Raphael Kuuchi, said at an aviation conference in Addis Ababa.

IATA forecast in December that African airlines would make a loss of around $200 million this year, similar to 2019.

Tewolde GebreMariam, chief executive officer of Ethiopian Airlines, Africa’s largest carrier, said the virus had slashed passenger demand.

Ethiopian Airlines has faced criticism online for not cancelling flights to China like neighbors Kenya, Tanzania and Rwanda.

“The air travel demand for Ethiopian Airlines has declined by 20% due to the corona,” Tewolde told Reuters.

“It is a big shock,” he told the conference.

On Tuesday, Kenya halted direct flights from Italy’s northern cities of Verona and Milan, which usually head to the Kenyan coast. Northern Italy has seen Europe’s biggest cluster of coronavirus cases.

Last month, Kenya Airways (KQNA.NR) and RwandAir suspended all flights to and from China until further notice.

The World Health Organization has advised countries against banning flights.

Senegal confirmed a second case of the coronavirus on Tuesday, bringing the total number of confirmed cases in sub-Saharan Africa to three.

Reporting by Dawit Endeshaw; Writing by Omar Mohammed; Editing by Mark Potter

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