Africa: SOE Overhaul, the Ethiopian Way

analysis

In an era of debt-ridden national flag carriers, Ethiopian Airlines stands out as a singular success - an example of how good governance can promote a vibrant service company, and of the advantage of technocrats being allowed to get on with their jobs free from political interference. Other African airlines should take note (we're looking at you, SAA).

Ethiopian Airlines has been a notable success story during a period when the aviation business has been seen, in the words of Warren Buffet, as a "great way to make a small fortune from a large one".

Ethiopian Airlines has grown to become the largest African airline in terms of passengers, and the world's fourth-largest by the number of countries served. This century the airline has expanded passenger numbers from one million to nearly 11 million in 2018, and its aircraft from 26 to 117. And the airport is catching up, with a new extension opening during 2019 along with the institutionalisation of a visa-on-arrival system.

The airline stands out in Africa where carriers were projected to lose US$200-million, or US$3.50 per passenger, during 2019, even though some governments, including Ghana, Uganda, Tanzania, Zambia and Chad, continue to be drawn to the...

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