The Growing Industry of Private Aviation in Africa – The Private Jet Setter

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In the previous article, we wrote about how Nairobi is spoiled by its range of taxi app choices, all competing to provide a better transportation service. Today, we will look at another transportation option: aviation.

As trade expands within African states, more business people are looking to purchase private jets to enable them to reach their target markets without the bureaucracy of commercial flights.

According to Melanie Humphries – Head of Aviation Finance for Africa at Investec Bank in South Africa, Nigeria and South Africa are leading the pack in private jet acquisition.

“The biggest trend that is driving the African business jet market is economic growth and wealth creation. Flexibility and convenience also play a role – on a continent where scheduled airline flights are not frequent, business jet users find that they can better plan and execute their business meetings and travel with their own aircraft,” Humphries told Hai Afrika.

 

A busy Johannesburg Airport scene

A busy Johannesburg Airport scene

 

“As such, we have seen a steady growth of high net worth Africans and corporates acquiring private aircraft to help meet their heavy business schedules,” she added.

Investec is one of the few African financial institutions that have specialized in aircraft purchases across Africa. And the growth in this sector is only going up.

Humphries reckons that the growth of net worth of individuals and corporates are soaring, creating pressure on the acquisition of personal aircrafts.

“Poor regional connectivity and limited infrastructure across the continent means that air travel is still the preferred mode of transport for passengers and cargo. This presents an opportunity for the aviation industry in Africa as a whole,” she asserts.

But with these expensive acquisitions, Africa is still viewed as the continent that cannot curb the spread of poverty. Doesn’t this paint a “greedy” view of the African businesses and corporations that purchase these aircrafts?

 

A private jet preparing to take off

A private jet preparing to take off

 

To this, Humphries argues that the planes help grow businesses in the continent and offer more jobs to Africans.  “As mentioned, the primary reason is that business aircraft are a necessary tool for many high net worth individuals and corporates that do business in and around Africa is  the limited infrastructure and poor regional connectivity.”

The buoyed growth of African business will definitely bring positive impact on the aviation industry. More business people are boarding planes for regional and international meetings and conferences. They do not necessarily have their own planes, but frequent fliers across the continent is a signal of economic growth, even for private jet owners.

“The aviation industry in Africa as a whole is growing. While the business jet market is still dominated by the US, with 65% of all business aircrafts being registered there, Africa’s fleet has more than doubled since 2000, with around 2.4% of the world’s jets being registered in Africa,” Humphries explained.

It is easy to think that the financing of such luxuries is hard. But according to Investec, it is not as hard as financing in other sectors. It is just that aviation has a classy and expensive appeal.

Humphries explained that financiers also look at the aircraft assets being acquired and the security packages structured. In turn, business jet owners require flexible, commercial terms of finance that make the acquisition commercially viable.

 

The interior of a luxurious private jet

The interior of a luxurious private jet

 

The bank has 25 dedicated professionals globally with experience ranging in aeronautical engineering, law, accounting, airline management, and leasing. This ensures that solutions are built around the client’s needs and expectations.

“As a bank of African origin, Investec is recognised as a leading aviation financier both on the continent and in the world. In addition, we were appointed as one of only two Qualified Advisors to the Export Import Bank of the United States to support the funding of US-manufactured exported aircraft,” she reiterated.

“As such, with our extensive experience in financing both new and preowned aircraft, we are well positioned to capitalise on growth in this industry across Africa, including Kenya.”