GCAA Says Market Forces Set Airfares, Opens Door to New Domestic Airlines | By Dominick Andoh
Ghana’s aviation regulator says domestic airfares are largely determined by market forces, while signalling that greater competition could help address persistent public concerns over the cost of flying between cities.
The Director-General of the Ghana Civil Aviation Authority (GCAA), Rev. Stephen Wilfred Arthur, said airlines operate in a largely deregulated pricing environment, with the regulator intervening where there is evidence of anti-competitive pricing or collusion.
“The price of an air ticket is essentially deregulated. In other words, market forces, to a larger extent, determine the price of the air ticket,” Rev. Arthur said during the PM Show on JOY News on Thursday.
The comments come amid renewed public concern over relatively high domestic airfares and limited seat availability in Ghana’s scheduled domestic market, which is currently dominated by Africa World Airlines (AWA) and PassionAir. Constrained domestic capacity and strong passenger demand have limited the immediate scope for fare reductions.
Rev. Arthur said the GCAA would act where pricing practices breached competition principles, adding that the regulator had the authority to investigate and impose appropriate measures to restore prices to what he described as a genuine market rate.
At the same time, he welcomed calls for more domestic airlines to enter the market, suggesting that additional operators could change the competitive dynamics.
“We welcome the suggestion of encouraging more domestic airlines to enter the market,” he said. “We are creating the enabling environment and also making sure that, whatever it takes to support a new entrant, we take them through the necessary regulatory processes.”
The regulator’s position comes as Ghana’s domestic aviation market shows signs of potential expansion. As revealed exclusively by AviationGhana.com, Ghanaian charter operator GIANAIR is preparing to move into scheduled domestic passenger operations, which could add another competitor to AWA and PassionAir. Two other companies are also undergoing the relevant regulatory processes to start domestic airline operations.
AWA is also expanding capacity. The airline recently added a 102-seat Embraer E190, its first aircraft under a planned fleet expansion programme, with the additional seats expected to ease pressure in a market where availability has been a factor in fare levels.
The combination of new capacity and potential market entry could therefore become more important to fare dynamics than regulatory intervention alone, Rev. Arthur added.
GCAA Says Market Forces Set Airfares, Opens Door to New Domestic Airlines | AviationGhana.com
