In 2016, Ugandan President Yoweri Museveni had a dream. After 30 years of lull, the East African country, whose airport has become a fixation of Hollywood movies, would have its national carrier flying across the world. The crane in the national flag would spread its wings and ensure the $450 million that Ugandans spent on foreign travel would remain in the national economy.
What started as a dream has now become a trend across the continent. As Uganda laid plans for the revival of its airline, Tanzania followed suit, and by 2019, both countries’ national carriers had returned to the skies.
Zambia has become the latest country to revive its state owned airline, with financial assistance from the continent’s most successful carrier – Ethiopian Airlines. Nigeria is also speeding with plans to relaunch its carrier by June 2022.
Zambia Airways was liquidated in 1994 and no one could have imagined the airline making its maiden flight on December 1st from Kenneth Kaunda International Airport in Lusaka to the Simon Mwansa Kapwepwe International Airport in Ndola, Copperbelt province.
The resumption of operations came after Ethiopian Airlines signed a definitive agreement with the Zambian Industrial Development Corporation (ZIDC) to acquire 45% shareholding in the air carrier for $30 million.
“The strategic equity partnership in the launching of Zambia Airways is part of our Vision 2025 multiple hub strategy in Africa. Ethiopian Airlines is committed to its growth plan in collaboration with African carriers and the new Zambia Airways will serve as a strong hub in Central and Southern Africa availing domestic, regional and eventually international air connectivity for passengers and cargo, which will enhance the socio-economic integration and tourism industry in Zambia and the region,” Tewodro GebreMariam, the CEO of Ethiopian Airlines, said of the partnership.
Zambia’s Minister of Transport and Logistic, Frank Tayali, praised the launch of the national carrier as a step in the right direction as the country strives to become a hub of the aviation sector in the southern African region. He also expressed optimism that the launch will help accelerate the development of other sectors such as tourism.
Zambia Airways will operate at a frequency of five to six times a week to Ndola and the southern city of Livingstone. It will initially operate domestic routes before introducing regional destinations in South Africa and Zimbabwe in the first quarter of 2022.
History of state-owned carriers
The euphoria of independence pushed many African governments to launch their state-owned airlines as a sign of sovereignty rather than business. Majority failed within the first 30 years of operations, but there have been some success stories with Air Maroc (Morocco), EgyptAir (Egypt), and Air Mauritius (Mauritius).
No place symbolizes the up and down tale of African state-owned airlines like Nigeria. During the oil boom of the 1970s, the flag carrier – Nigeria Air – was one of the pre-eminent airlines in the world but as recession kicked in a decade later, it was liquidated.
Another chapter is set to be added to that story as officials say the state carrier will finally take to the skies in April 2022, following the approval of the outline business case for the establishment of the national carrier by the Federal Executive Council (FEC).
Nigeria’s Minister of Aviation, Senator Hadi Sirika, says the national carrier will be run by a company in which the Nigerian government will hold a 5% stake, Nigerian entrepreneurs holding 46%, while the remaining 49% will be reserved for yet to be assigned strategic equity partners, including foreign investors.
Growing aviation sector
Over the next two decades, air traffic in Africa is forecast to grow six percent a year – twice as quickly as in mature markets. But still, most state-owned flag carriers on the continent are losing money.
The notable exception is Ethiopian Airlines, which analysts say has avoided the mistakes of other regional carriers by not falling prey to political interference.
For countries that launched their carriers few years ago, it has been a case of solidifying gains despite the impact caused by the pandemic.
In November, Tanzania’s national carrier – Air Tanzania – resumed operations between Dar es Salaam and Kenya’s capital, Nairobi, two decades after it went to oblivion.
Apart from Nairobi, Air Tanzania also announced three new regional routes; from Dar es Salaam to Bujumbura (Burundi), Ndola (Zambia), and Lubumbashi (DR Congo).
Tanzania is seeking to expand passenger services to new markets in Africa, Asia, and Europe as international borders reopen and travel restrictions ease. It currently serves Mumbai (India), Hahaya (Comoros), Lusaka (Zambia), Harare (Zimbabwe), Entebbe (Uganda), and Guangzhou (China).
The airline has planned to add Johannesburg (South Africa), Lagos (Nigeria), Accra (Ghana), and London (United Kingdom) to its destinations in the coming months.
To achieve those lofty aims, it has also made orders for an additional six aircraft for $726 million, including a Bombadier Q 400, two Boeing 737-900s, two Boeing 787-800 Dreamliners, and one Boeing 767 Freighter, all of which are due to enter the fleet within the next two years.
While Air Tanzania’s revival has picked pace, Uganda has showed the perils of initiating such moves without a well thought master plan.
The East African country was banking on its emerging oil industry – and the tourism sector – to generate international traffic to sustain the revitalised airline. As it often happens on the continent, those plans quickly went sour due to mismanagement and corruption.
“We undertake to be a world-class airline that will exceed customer expectations through high-quality service,” then Ugandan Airlines CEO Ephraim Bagenda said at the relaunch ceremony in 2019 at Entebbe International Airport, which lies 40km south of the capital, Kampala, and is the country’s sole international airport.
Two years later, Uganda Airways is facing financial difficulties that have crippled its ability to step up operations.
In a January confidential report to President Museveni, the acting chief executive officer, Cornwell Muleya, raised concern on a number of issues; incompetence of the board as one of the members has no aviation background, tendency by some board members to interfere in management areas, especially in the areas of procurement and staff, collusion between procurement managers and staff in government ministries to siphon money from the airline.
“They advised that I must try to understand how business is done in Uganda because these practices are normal in this country. They have gone so far as to suggest that our ethical approach management may be one of the reasons why we are experiencing delays in the release of company project funds from the ministries within government.”
Muleya also said the airline required $61.4 million in the first quarter of the year to cover arrears from the last two financial years.
Most of the carrier’s financial problems are of its own making. For example, during the ceremony to receive the first Bombardier jets in 2019, Uganda Airlines incurred through a PR firm $218,300 for hosting 600 guests, while for the event to receive the first airbus, the airline spent $34,000 for 350 guests.
Then, there have been other issues of inflated air-tickets, unnecessary travels by both management and the board, the sorry state of airline stations in countries where the airline launched, shady procurement deals, and dubious fuels deals, especially on the Mogadishu route in which a certain Ugandan army general is reportedly involved.
Africa’s golden age of state-owned airlines will require prudent administration and robust oversight to avoid the similar fate that befell the sector in the 1990s.