AIR ZIM IN $1.7M RESCUE DILEMMA Partnership deals in limbo
NEGOTIATIONS with three of the 12 potential partners that the Government had identified to revive Air Zimbabwe have not yielded the desired results, a Cabinet Minister has said.
The ailing national airline has a huge debt overhang amounting to about $300 million, which the Government pledged to takeover once a strategic partner had been identified.
Transport and Infrastructural Development Minister Dr Joram Gumbo told Business Chronicle on the sidelines of the just ended Parliamentary 2017 pre-national budget seminar in Bulawayo that the Government was still searching for a potential partner to get the best deal.
“We have made an announcement that the Government is looking for a strategic partner for Air Zimbabwe. The process is going on and we have not found one. And when looking for a partner, you do not just pick somebody because they are beautiful. But you have to consider what am I partnering, what is it that they will offer me and what is it that I am going to offer,” he said.
Dr Gumbo said the Government through his ministry has approached airlines in Singapore, Malaysia and Ethiopia. Asked why the process to secure a strategic partner was seemingly taking too long, he said: “Because we are not agreeing on terms. We are negotiating with whoever, you cannot just go and say I want a partner. Somebody will say for example, I want to look at your books, routes and the equipment that you have got and so forth.
“So, we are still negotiating and there is no timetable in concluding the discussions. And if there was no hope for securing a partner, I would not be discussing and I must continue until I am exhausted.”
He said a number of airlines on the continent and internationally were not performing well.
Among the 12 partners that the Government has identified as potential suitors for Air Zimbabwe are Angolan Airlines, Boeing, Emirates and Airbus.
Airbus is a division of France-based multinational Airbus Group SE that manufactures civil aircraft while Boeing is an American corporation that designs, manufactures and sells aeroplanes, rotorcraft and rockets across the globe. It also provides leasing and product support services.
Meanwhile, Air Zimbabwe needs about $1.7 million to pay for the servicing of its two A320 airbuses that were taken to South Africa for maintenance in 2014.
The two airbuses were taken to South Africa for C-Checks, a comprehensive overhaul done on an aircraft after a certain amount of time or usage.
One of the two airbuses that was paid for is plying the Harare - Dar es Salaam route, which the flag carrier launched in June this year.
Dr Gumbo said at the moment the Government was financially hamstrung to pay for airbus’ C-checks.
The struggling airline’s current fleet includes Boeing 737-200 (Advanced), Boeing 767-200 ER and Airbus A320-200.
“At the moment, we are failing to pay for the C-Checks that were done on that airbus. We do not have the money to pay for it,” he said in an interview.
Speaking by telephone from Harare yesterday, the chairman of the Parliamentary Portfolio Committee on Transport and Infrastructural Development, Mr Dexter Nduna, who is also Chegutu West legislator, said servicing of the airbus in South Africa had been completed.
“Servicing of Air Zimbabwe’s airbus that is still in South Africa has been done. For as long as we do not pay for the servicing, the airbus will remain grounded there (South Africa),” he said.
Air Zimbabwe is faced with operational challenges from a number of factors that include high operational costs, low load factors and a huge debt overhang.
According to the Portfolio Committee’s report presented in Parliament recently, Air Zimbabwe was losing $3 million a month and is technically insolvent.
The report indicates that the airline was generating an estimated revenue of $2,65 million a month against an operational expenditure of $5,94 million.
The Government has also announced plans to takeover Air Zimbabwe’s debt once a strategic partner is found. - @okazunga
Ms Unaiswi Nyikadzino Schweppes head of marketing and public relations (left) and JMN Polytechnic principal Dr Ngoni Moyo unveil a plaque infront of the commissioned borehole at Gwanda JMN (Zintec) campus last Friday