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Ethiopian Airlines team expected for Air Zimbabwe deal

by Staff reporter
05 Mar 2019 at 07:52hrs | Views
An Ethiopian Airlines team is expected in the country next month to start negotiations for the proposed partnership deal between Air Zimbabwe and Africa's biggest and most profitable airline.

Ethiopian Airlines has offered Air Zimbabwe a lucrative partnership deal that will see it bringing in planes, training local pilots, and assisting Air Zimbabwe to become an aircraft maintenance hub in the SADC region.

The deal was proposed when Ethiopian Airlines chief executive Tewolde Gebremarian paid a courtesy call on President Emmerson Mnangagwa in Addis Ababa when the President attended the AU summit there early this month.

Joe Biggie Matiza, the Transport and Infrastructure Development Minister, confirmed the development. "There is movement on that front and we are expecting a team from Ethiopian Airlines next month where we are going to have meetings with regards to how the deal can be undertaken. We invited them so that we can talk and chart a way forward," he told the Business Times.

Ethiopian Airlines, which flies from Addis Ababa to Harare and Victoria Falls, is eager to have a partnership deal with Air Zimbabwe. The airline is also prepared to support Air Zimbabwe for maintenance so that it becomes a hub of maintenance of aircraft just like Addis.

This is not the first time that Ethiopian Airlines have been linked to a partnership deal with Air Zimbabwe. In 2017, Ethiopian International Services managing director, Esayas Woldemariam, said talks were underway but it depended on the political will of the government of Zimbabwe on how they wanted to put it, "whether it is going to be a joint venture or management consultancy", he told journalists after Ethiopian made its maiden flight to Victoria Falls. He said Zimbabwe had "very intelligent" people, but Air Zimbabwe was lacking focus.

Air Zimbabwe was placed under reconstruction under Reggie Saruchera of Grant Thornton and Camelsa due to its continuous failure to generate profits to remain commercially viable. Under general notice 758 of 2018, published in the Government Gazette, Justice Minister Ziyambi Ziyambi issued a reconstruction order in relation to Air Zimbabwe Limited and Air Zimbabwe Holdings Private Limited.

Air Zimbabwe is one of the country's critical parastatals that the government wants to revive, given its central role in the economic turnaround plan, particularly boosting the tourism sector. Tourism is seen as a low hanging fruit that can help revive the economy.

Air Zim is currently saddled with a $341m foreign and domestic debt, which has been accumulated over a decade of mismanagement. The inability to repay the debt has left the airline in a quandary as it is now stripped of its international aviation privileges.

Ethiopian Airlines is working on a programme to establish multiple hubs on the continent. In 2013, it bought a 49% shareholding in Malawian

Source - businesstimes