GCAA says market forces, not regulator, determine air ticket prices

Director-General, of the Ghana Civil Aviation Authority (GCAA) Rev. Stephen Wilfred Arthur

The Ghana Civil Aviation Authority (GCAA) says air ticket prices in Ghana are determined largely by market forces and not by the regulator.

Director General of the GCAA, Rev Stephen Wilfred Arthur, said that air ticket pricing in the domestic aviation industry is deregulated.

He said the regulator only has the mandate to intervene in cases of anti-competitive practices or price collusion.

“I must add my voice to that of the general public to indicate that indeed there have been varied concerns in terms of the level of the air ticket to various destinations, especially within our domestic space,” he said.

“But permit me to make this very fundamental statement: in our industry, the pricing of an air ticket is not fixed by the regulator, that is, the Ghana Civil Aviation Authority. The price of a ticket essentially is deregulated.”

According to Rev Arthur, “the market forces to a larger extent are determining the rate of the air ticket.”

He, however, said the GCAA can investigate and impose sanctions where airlines engage in anti-competitive practices or price collusion.

He also backed calls for more airlines to enter Ghana’s domestic aviation market, saying increased competition could help reduce fares.

“One of the cardinal factors to consider is to inject competition, because definitely when there are more players in the industry, or more airlines in the air transport space, definitely there will be more seats by way of capacity,” he said.

He added that competition could improve service quality while “pushing the airfare a bit downwards to be more affordable than we have it at the moment.”

Rev Arthur said the GCAA is ready to support prospective airlines through the regulatory process.

“Yeah, we are very much open, and we create a level playing field for all prospective applicants or airlines, without any discrimination,” he said.

But he stressed that safety and security would not be compromised to attract more operators.

“The greater burden is not so much on the regulator, but on the applicant to meet all the necessary requirements, because at all times we will never compromise on safety and security just for the sake of injecting the space with more players,” he said.

Rev Arthur also pointed to government’s withdrawal of import duties on aircraft spares as a measure that could help reduce operating costs for domestic airlines.

He said lower operating costs could eventually support meaningful reductions in airfares.

“We do appreciate that it is not the only reason. They have fuel, they have the leasing cost, but at least there is a demonstration on the part of government that something is being done,” he said.

He said the domestic market exists and could expand if fares become more affordable.

“If more players come on the scene, if fares go down, more people will be ready and willing, and can afford to, fly domestically,” he said.

DISCLAIMER: The Views, Comments, Opinions, Contributions and Statements made by Readers and Contributors on this platform do not necessarily represent the views or policy of Multimedia Group Limited.

Tags:  

DISCLAIMER: The Views, Comments, Opinions, Contributions and Statements made by Readers and Contributors on this platform do not necessarily represent the views or policy of Multimedia Group Limited.