The global air transport industry:

1 Source: IATA www.iata.org/economics

The global industry outlook remains bright…

2 www.iata.org/economics Source: IATA/Tourism Economics

3.5% Average annual growth in global air passenger journeys over the next 20 years

2.0x The number of air passenger journeys in 2037 compared with today

20-year air passenger growth is shifting East & South

Source: IATA/Tourism Economics 3 www.iata.org/economics

In Africa, air transport supports…

4

…6.2 million jobs & $55.8 billion of GDP

Source: ATAG www.iata.org/economics

Demand for air travel in Africa to soar in the middle run

Source: IATA/Oxford Economics www.iata.org/economics 5

334

135

100

150

200

250

300

350

400

2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 2037

No Policy Change

Policy Stimulus & Market Liberalisation

Pick-up in Protectionism

million passengers per year (O-D basis)

6 Source: ATAG www.iata.org/economics

20-year passenger growth outlook (2017-37)

7 Source: IATA/Tourism Economics www.iata.org/economics

The markets of tomorrow

Source: IATA/Tourism Economics www.iata.org/economics 8

Top 10 air markets in Africa shows few changes

9 www.iata.org/economics Source: IATA/Oxford Economics

1

2

3

4

5

6

7

8

9

10

2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 2037

Egypt

S. Africa

Tanzania

Mauritius

Ethiopia

Kenya

Tunisia

Nigeria

Algeria

Morocco

Egypt

Nigeria

Algeria

Kenya

Ethiopia

Tanzania

Tunisia

Morocco

Sudan

S. Africa

Drivers of demand for air travel in Africa: Population

10 www.iata.org/economics Source: IATA/Oxford Economics

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037

African Population in Million

Total population evolution: Africa

Drivers of demand for air travel in Africa: Income

11 www.iata.org/economics Source: IATA/Oxford Economics

0

500

1,000

1,500

2,000

2,500

2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037

African per Capita GDP in Real USD

Per capita GDP evolution: Africa

Strong increase in # of passengers over next 20 years

12 www.iata.org/economics Source: IATA/Oxford Economics

0 10,000 20,000 30,000 40,000 50,000 60,000

Egypt

Morocco

Ethiopia

Kenya

Nigeria

South…

Tanzania

Number of passengers per year (‘000)

Number of passengers in African countries with strong airline industry

2017

2037

… translating into high annual passenger growth rate

13 www.iata.org/economics Source: IATA/Oxford Economics

3.7

2.3

6.4 6.2

5.4

3.8

6.3

4.6

1

2

3

4

5

6

7

Compound annual growth rate (CAGR) for passengers

Passenger average yearly growth rate for period 2017-2037

Egypt Morocco Ethiopia Kenya Nigeria South Africa Tanzania Africa

Visa openness index 2018

Source: UNWTO www.iata.org/economics 14

Air travel connectivity from Africa to the World: 2008

15 www.iata.org/economics Source: SRS Analyser

Air travel connectivity from Africa to the World: 2018

16 www.iata.org/economics Source: SRS Analyser

Air travel connectivity within Africa: 2008

17 www.iata.org/economics Source: SRS Analyser

Air travel connectivity within Africa: 2018

18 www.iata.org/economics Source: SRS Analyser

Source: IATA Economics using data from ICAO, The Airline Analyst, IATA forecasts

Regional profitability remains very uneven

-6%

-1%

4%

9%

N America Europe Asia Pacific Middle East L America Africa

Net post-tax profit margins

2015 2016 2017 2018

Regional (net) profitability – Africa

www.iata.org/economics 20 Source: IATA

-8%

-6%

-4%

-2%

0%

2%

-2.0

-1.5

-1.0

-0.5

0.0

0.5

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018f

Net profit (Left axis)

US$bn

Airline Cost Drivers in Africa

-6% -4% -2% 0% 2% 4% 6%

Station expenses

Flight crew salaries and expenses

Passenger services

Other expenses (flight operations)

Depreciation and amortization

Flight equipment insurance

Other operating expenses

Flight equipment rentals

Ticketing, sales and promotion

Aircraft fuel and oil

Flight equipment maintenance and overhaul

User charges

Percentage points difference in shares of total regional costs.

Differences in cost sources: Africa vs Industry

The 0% line indicates the industry average.

Lower than industry average

Higher than industry average

How IATA initiatives impact cost-drivers in Africa

-6% -4% -2% 0% 2% 4% 6%

Station expenses

Flight crew salaries and expenses

Passenger services

Other expenses (flight operations)

Depreciation and amortization

Flight equipment insurance

Other operating expenses

Flight equipment rentals

Ticketing, sales and promotion

Aircraft fuel and oil

Flight equipment maintenance and overhaul

User charges

Percentage points difference in shares of total regional costs.

Differences in cost sources: Africa vs Industry

The 0% line indicates the industry average.

Lower than industry

Higher than industry average

ASA best practice clauses

Airport Privatization Efforts

Standards & initiatives related to distribution issues

Smarter Regulation

Advocacy