Govt urged to set up national airline

Mar 21, 2005

THE Government is under pressure to re- establish a national airline following the poor performance of private local companies which tried to operate after the fall of Uganda Airlines.

By Emmy Olaki

THE Government is under pressure to re- establish a national airline following the poor performance of private local companies which tried to operate after the fall of Uganda Airlines.

Industry sources say Civil Aviation Authority (CAA) is working on a document for the Cabinet in which it recommends that the state re-establish a national carrier.

One of the major reasons advanced for the move is the need to counter predominance of foreign carriers, which has increased ticket prices and made it difficult for local start-ups to grow.

Emmanuel Okware, the country manager of Kenya Airways, said an airline can be an important national asset.

“Any nation worth its salt must support a national airline where it has a stake. It can partially run a carrier, but with well-defined share holding,” Okware said in a telephone interview yesterday.
In the last four years, two local airlines, Africa One and East African Airlines (EAA) joined the aviation industry, but faced stiff competition from established carriers.

Competition forced Africa One to wind up in 2003, while EAA suspended flights to South Africa last month.

In the document, CAA is said to be recommending that the Government provides capital guarantees to investors, who would team up with a successful international air operator, or that the Government out rightly invests in the industry, with a timeline for disengagement.

However, there were concerns among industry players that politicians would hijack the new initiative and make it a burden on the tax payer.

“The Government should not put money in airline business, because most are owned by politicians, who may mess up tax-payers’ money,” the source said.

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