AfDB Launches Platform to Capture Africa’s $25tn Aviation Market
The African Development Bank (AfDB) has unveiled the Integrated Aviation Transformation Programme, a continent-wide financing platform designed to turn surging passenger demand into sustainable profits. Presented at the Airlines, Capital and Connectivity Forum in Nairobi, the initiative seeks to mobilise long-term capital for a sector that remains paradoxically unprofitable. Despite Africa being home to 18 per cent of the global population, it currently accounts for less than 3 per cent of global air traffic, representing a massive untapped opportunity.
Industry forecasts suggest that one in four new global air travellers will originate from Africa within the next two decades. This growth is underpinned by rapid urbanisation and an expanding middle class. However, African carriers are struggling to find clear skies. The International Air Transport Association projects that African airlines will post net margins of only 1 to 2 per cent in 2026. This is significantly lower than the global average forecast of 3.9 per cent, highlighting a persistent gap in operational efficiency and financial health.
The AfDB’s new platform aims to address these structural weaknesses by reducing investment risks and strengthening airline bankability. Mike Salawou, the bank’s Director for Infrastructure, noted that high borrowing costs and fragmented regulations have historically deterred private investors. The programme intends to align policy reforms with financing instruments into a single framework. By doing so, the bank hopes to attract institutional funds that have previously viewed African aviation as too high-risk.
A primary hurdle identified at the forum is the lack of intra-African connectivity. Currently, only 25 per cent of air traffic involving African travellers occurs within the continent. This forces many passengers to transit through European or Middle Eastern hubs to reach neighbouring African states. Experts argue that strengthening regional routes would not only improve airline revenues but also stimulate continental trade and tourism under the African Continental Free Trade Area.
The African Union Commission emphasised that the Single African Air Transport Market (SAATM) remains the most critical policy lever for success. Full implementation of this “open skies” agreement would allow airlines to fly between any two African cities without restrictive bilateral treaties. Officials from Nigeria, Kenya, and Ethiopia shared experiences suggesting that national-level reforms are already creating near-term investment opportunities in airport infrastructure and cargo logistics.
Sustainability and skills development are also on the agenda. The forum explored financing models for climate-aligned aviation and risk-sharing instruments to protect investors from currency volatility. Analysts believe the success of the AfDB’s initiative rests on the speed at which governments can harmonise their regulations. If the supply side can catch up with demand, the next decade of African aviation will be defined by commercial returns rather than just passenger numbers.