As Kenya Airways prepares for another round of state bailouts, we sit down with the national carrier boss and discuss about when he thinks the bailouts will stop and KQ will be ready to stand on its feet.
LET US TALK ABOUT THE NEW ROUND OF BAILOUTS WHEN WILL KQ STOP REQUIRING BAILOUT?
From 2020, it was very difficult for aviation in the world. I believe 95 or 99 per cent of airlines, first of all, made losses including the very big ones but they got huge government bailouts.
I just want to dissuade people from thinking that, and I know Kenyans get tired because of these bailouts, but it was a worldwide phenomenon, without those bailouts the airlines would have collapsed, and same with us.
In our case it’s loans, in some cases, it’s just capital injection.
SO THE BAILOUTS ARE ACTUALLY LOANS, HOW MUCH SO FAR AND DO THEY EARN INTEREST?
Yes, it is a loan, earning interest but that is not something we can share. So far we have received about Sh20 billion from the beginning of 2020.
But actually, if you can get a list of all other bailouts including some of the airlines in Africa and then you compare it with ours, you would be surprised. And like you said it is a loan which we will pay back at an opportune time.
HOW MUCH MORE SUPPORT DO YOU EXPECT AND WHEN IS IT LIKELY TO COME IN?
So the supplementary budget has put I believe Sh20 billion of course parliament has to approve that and that is a parliamentary process so I cannot tell how long it will take.
WHAT ARE THE SPECIFIC CONDITIONS FOR THE SUPPORT FROM GOVERNMENT? Because the government is going through an economic recovery programme with the IMF, any support that they are going to extend to us will fall under that programme. They require us to abide by conditions that will necessarily ensure that efforts to turn over the company are successful.We do not want to come back and do this again. We do not want another attempt because this is something we want to do now and make it sustainable going forward.And that is why the government is interested to make sure that we have someone like Seabury to support us in ensuring that we have a permanent reduction in costs of doing business as opposed to a one-off […]
