International Air Transport Association (IATA) Director General and CEO Giovanni Bisignani has blasted the South African regulatory committee which oversees the country’s monopoly air transport infrastructure service providers. Speaking on Thursday to journalists in Johannesburg, Bisignani asserted that South Africa has “a phantom regulator”.

“The cost of [South African] airport infrastructure is a big, big concern,” he affirmed. “The South African economic regulatory process is not effective. When you operate a monopoly, you have no competition, so you need a regulator. That regulator needs to be respected. But the regulator is not effective.”

He pointed out that the regulator was almost certainly going to allow the Airports Company South Africa (Acsa) to raise its charges by 129% between 2010 and 2015. “There’s no situation in the world like this,” he highlighted. “You’re adding $1,2-billion to airline costs. It’s a big burden for the airlines.”

He pointed out that the average profit margin for airlines, worldwide, over the past 40 years had been just 0,1%, and that although last year had been an extremely good one for the industry, with an average profit margin of 2,9%, this forecast for this year was less than half of this, at 1,4%.

This jump in Acsa’s charges will make OR Tambo International Airport one of the most expensive airports of its size in the world.

On top of this, the regulator is allowing South Africa’s Air Traffic and Navigation Services (ATNS) company to increase its fees by 71%, also over the period 2010 to 2015. ATNS asked for a 77% increase, but Bisignani and IATA regard the cut to 71% as insignificant.

He noted that the substantial increases in Acsa and ATNS charges over the next few years runs directly counter to the government’s intention to further stimulate the country’s tourist industry. He cited the South African government’s estimate that, for every 16 tourists that visit this country, one job is created.

Bisignani also criticised the government’s plan to impose a carbon tax on domestic flights (a tax on international flights would be illegal), arguing that the international aviation industry – airlines, aircraft and engine manufacturers – has established itself as a world leader in reducing carbon emissions and has been commended as a role model by United Nations Secretary General Ban Ki-moon.

Internationally agreed arrangements, under the aegis of the International Civil Aviation Organisation (ICAO), are required. (IATA represents airlines, ICAO represents governments.)