African airlines profit lags as global skies soar
African airlines will remain the least profitable globally in 2025, according to the latest financial outlook by the International Air Transport Association (IATA), underscoring persistent structural and economic challenges in the aviation sector across the continent, despite the improved financial performance of the global industry.
The latest economic outlook for the airline industry was released on Monday on the sidelines of the ongoing IATA annual general meeting in New Delhi, India.
While the world's airlines are expected to post net profits of $36 billion this year — up from $32.4 billion in 2024 — African carriers are forecast to collectively earn just $200 million, representing a net profit margin of 1.1 percent, the weakest among all regions.
This is in stark contrast to other regions such as North America, which is projected to record the highest absolute profits at $12.7 billion, and the Middle East, which leads on per-passenger profitability at $27.2.'Africa's aviation sector remains one of the most vulnerable despite strong demand fundamentals,' said IATA director-general Willie Walsh. 'High operating costs, aircraft shortages, and currency constraints continue to drag down profitability across the continent.'Globally, airlines are expected to carry 4.99 billion passengers in 2025 — a new record — with total industry revenues reaching $979 billion, driven primarily by a 1.6 percent rise in passenger revenues and stable jet fuel prices, now forecast at $86 per barrel, down 13 percent from last year.'Wafer-thin buffer'However, IATA cautioned that this apparent strength masks a deeper fragility.'A $36 billion profit translates to only $7.20 per passenger,' said Walsh. 'That's a wafer-thin buffer. Any new tax, regulation, or shock could easily undermine the gains.'Despite global GDP growth slowing to 2.5 percent, the industry is showing resilience, largely due to efficiency gains, a record 84 percent passenger load factor, and moderating inflation.
Passenger yields, however, are expected to fall by four percent, making air travel more affordable — with average return fares projected at $374, 40 percent lower than in 2014.
In Africa, demand for air travel is expected to grow by eight percent in 2025, but capacity growth remains limited at 7.3 percent, held back by fleet shortages, spare parts scarcity, and limited foreign currency availability in key economies like Nigeria and Zimbabwe.
African airlines are expected to earn just $1.3 profit per passenger, far below the $11.1 per passenger in North America and $8.9 in Europe.
Despite these constraints, IATA sees opportunity.'The demand is real,' said Walsh. 'What's missing is a more enabling environment for airlines — from regulatory reforms to infrastructure investment and financial liquidity.'Several African carriers are also grappling with grounded aircraft, especially those affected by engine reliability issues and a global backlog of more than 17,000 aircraft, which has pushed the average age of the African fleet to 15 years.
Cargo volumesOn the cargo side, global air freight is expected to slow significantly in 2025 due to protectionist trade policies. Cargo revenues are forecast to drop 4.7 percent to $142 billion, with volume growth nearly flat at 0.7 percent, compared with 11.3 percent last year.
Africa, a marginal player in global air cargo markets, is expected to feel this impact acutely due to its limited integration in global supply chains.
IATA also raised concerns over Sustainable Aviation Fuel (SAF) costs and availability, highlighting the disproportionate burden it places on smaller and developing-market carriers.
With SAF costs averaging 4.2 times more than jet fuel in 2025, and SAF mandates in Europe pushing up supplier pricing, African airlines — many of which are already financially stretched — face growing pressure.
The outlook also warns of major geopolitical and macroeconomic risks. From ongoing conflicts to trade tensions and fragmentation of global aviation standards, IATA says uncertainty could upend the cautiously optimistic projections.
For Africa, vulnerability to external shocks is amplified by weaker financial buffers and policy instability in several markets.
Still, IATA remains hopeful.'With the right reforms and investment, African aviation can not only grow — it can thrive,' said Walsh. 'But the clock is ticking.'
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