The govt wants the airline ‘revived and in operation’
Minister for Infrastructure Development, Dr Shukuru Kawambwa. Photo/LEONARD MAGOMBA
Dr Shukuru Kawambwa, Tanzania’s Minister for Infrastructure Development said that Tanzania opted for the strategic partnerships with other airlines because the four-year old negotiations between ATCL and China Sonangol International Limited had not materialised.
He said the negotiations with Sonangol has taken too long and were yet to be concluded, hence the government’s decision to approach Zimbabwe.
According to the Minister, the ailing airline needs more than $540 million to operate effectively and that the government was in the final stages of launching the new state-owned airline into the competitive airline market.
At the same time, the government has said it was seeking new bidders to strengthen ATCL in order to lure US investors who have shown interest.
US firm firm, Celtic Capital Air Corporation, has shown interest in the operations of the ATCL and five other firms based in the US, the UK and the United Arab Emirates have also shown interest.
As the deal with the Chinese firm was going on, other measures were taken to bring the airline back into profitability which included the retrenching of 155 employees.
Overstaffing and accumulated staff wages were considered a financial burden to the airline compared with the airline’s aircraft numbers.
Currently the airline has only 182 employees.
Omar Chambo, the permanent secretary for the parent Ministry of Infrastructure Development, told The EastAfrican that the government wants to see ATCL revived and back to full operation because it has business potential to serve not only the country but also the growing markets of DR Congo, China, Zambia and Malawi.
Critics however say the government has not kept its word on giving ATCL full support since the firm parted ways with South African Airways a few years ago.
ATCL, formerly known as Air Tanzania Corporation (ATC) was privatised on December 2, 2002 in a deal under which South African Airways acquired 49 per cent shares, for only $20 million, which largely went into shareholding.
The rest of the funds went into capital and training.
In August 2008, Tanzania held secret talks with the Chinese Development Bank to sell its 49 shares in the troubled ATCL to a Hong Kong-based private firm in a bid to revive the airline.
In the deal, China Sonangol International Holding Ltd was expected to fund the airline’s operations.
