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RwandAir fills gaps in Africa sector for growth

Airline’s revenues rise 20% annually; break-even expected by 2018

Addis Ababa - The chairman of Rwanda’s state-run airline RwandAir said he expected the airline to break even by 2018, carving out a niche by connecting under-served destinations across Africa.

The airline is already growing revenues by 20 per cent annually, Girma Wake, the chairman of RwandAir’s board of directors, said on Friday in an interview on the sidelines of a bilateral meeting in the Ethiopian capital Addis Ababa that included Rwandan President Paul Kagame.

“It has not achieved profitability yet, but soon it will. I am sure in two or three years, it will be able to break even,” the former chief executive of Ethiopian Airlines said, without giving more detailed figures.

The airline currently flies from Kigali to most capitals of east and central Africa, as well as to Lagos in Nigeria, Ghana’s Accra and Johannesburg in South Africa. Its sole destination outside the continent is Dubai.

Upon delivery of wide-body aircraft in the second half of next year, RwandAir will start services to China, India and some European destinations, Wake said.

With air travel between African states largely untapped, however, Wake said the Rwandan airline wanted to take advantage by strengthening its presence closer to home.

“Africa has a problem. The interconnectivity of Africa is still weak and airlines like Rwandair can fill that gap,” Girma said.

Many African states have adopted the Yamoussoukro Decision of 1999 that aimed to open up intra-African aviation routes. However, the decision is yet to be fully implemented by governments, meaning air travel within Africa largely remains underdeveloped.

“The big carriers are looking for non-stop flights, so the inter-Africa link is getting weaker and weaker,” he said.

RwandAir currently has a fleet of two Boeing 737-800NGs, two 737-700NGs, two CRJ900NGs and one Dash 8-200. Last month, it signed a memorandum of understanding for two A330 aircraft, in a deal worth around $500 million based on list prices.

The Central African country’s flagship airline was formed only 13 years ago.

“This is an airline that is covering already over 80 per cent of its cost, which is very good for an airline which is at an investment stage,” said Wake.