NAIROBI, KENYA: President Uhuru Kenyatta has appealed to the Parliament to prioritise the National Aviation Management Bill.
In a State of the Nation Address, the president said the bill if passed will help turnaround the fortunes of loss-making national carrier Kenya Airways. Read More
KQ has been pushing for nationalisation, which its leaders have said is the only way out for the carrier that last made a profit in 2012.
The airline has argued that reverting to the government would put them at an equal footing with its competitors such as Ethiopian Airways and a host of Arab carriers, which have dominated the Kenyan and regional airspace.
The cited competitors are government-owned and KQ has in the past noted are not necessarily driven by profit-making, which KQ has to consider since it has an obligation to shareholders other than the government who have been seeking a return on their investment.
KQ was privatised in a 1996 deal that saw the Dutch carrier KLM brought on board as a strategic partner, which was in addition to listing at the Nairobi Securities Exchange (NSE).
Before the agreement to privatise, the carrier had made a privately initiated investment proposal (PIIP) to run the Jomo Kenyatta International Airport (JKIA). This was however fought on several fronts including by Kenya Airports Authority and Members of Parliament.
The Bill proposes the formation of an Aviation Holding Company, which will own KQ and KAA. The airline will get tax holidays including exemption from paying taxes on engines, maintenance, and fuel, enabling it to bring down its cost of operations.
“We are desirous of accelerating the implementation of our National transformative Agenda,” Uhuru said.
“In this regard, I urge Parliament to prioritize the consideration of various seminal Bills that are pending before the Legislature, such as the National Aviation Management Bill, which once enacted, will anchor the turnaround of the Pride of Africa – our National carrier, Kenya Airways.”
“Also before the House, is the Statute Law Miscellaneous (Amendments) Bill, Business (Amendment) Bill Number 2 of 2020 and proposed legislation on the administration of referenda and on enhancing governance and on deepening our anti-corruption efforts.”