21 September 2014
   
New Zimbabwe Header
Escaped Zim illegals re-arrested in SA
RBZ debt: Chapfika got $80k, never repaid
Zanu PF MP lashes out at govt minister
Two million to need food aid: WFP
UK nurse makes sanitary pads for Zim
Masvingo man battered over US$1 bill
Beitbridge Rd work stalls over court row
Ebola: Sierra Leone shuts down for 3 days
MORE NEWS
FlyAfrica cuts Hre-Joburg fares 80pc
RioZim seeks funds to revive closed mine
MORE BUSINESS
The veteran scribe who won’t back down
TB Joshua: When stupidity rules
MORE SHOWBIZ
Highlanders beaten as Dynamos held
Caps United seek Sunday redemption
MORE SPORTS
Dulini: Principled and dependable to the end
Stealing farms will not empower society
MORE OPINION
 
Gutu: Put Zimbabwe first
Social responsibility vs economic efficiency
MORE COLUMNISTS
 
 
Government assumes Air Zim’s US$140m debt
24/10/2011 00:00:00
by Staff Reporter
 
Rescue bid ... Nicholas Goche
 
RELATED STORIES
Chinese airline in Air Zim talks
Minister's fury over AirZim downgrade
Air Zim resumes Beijing, London flights
Air Zimbabwe courts foreign partners
Fuel dispute grounds Air Zimbabwe
Air Zimbabwe re-opens London route
Storm-flying pilot gets wings back

THE government will assume responsibility for Air Zimbabwe’s $140 million debt in a bid to help the technically insolvent flag-carrier back on its ‘wings’, Transport Minister Nicholas Goche has said.

The airline has been crippled by numerous operational problems including mounting debts, ageing aircraft, undercapitalisation and labour disputes with key staff.

Goche said the government had agreed to takeover the debt and help find the company a technical partner.

“Last Thursday Cabinet … resolved that, Air Zimbabwe as a strategic Government asset and brand, needed to be preserved and supported as a going business concern,” Goche told The Herald.

“To this end, Government must assume Air Zimbabwe's current debt (currently standing at US$140 million) and ring fence the same."

Air Zimbabwe chief executive, Innocent Mavhunga recently urged government to help liquidate the airline’s huge debt pile comprising $112.7 million internal obligations and $25 million owed to institutions outside the country.

“Our cost of operating the business sits at about $6 to $7.5 million,” Mavhunga told Parliament’s Portfolio Committee on State Enterprises and Parastatals at a recent hearing.

Meanwhile, Goche said proceeds from the planned part-privatisation of the airline would be used to offset the debt while staff numbers would also be reduced to cut operating costs.

"In order to realise additional financing, there is urgent need to find a strategic partner for the national airline through private placement, that is, directly approaching would-be interested investors and forming a joint venture partnership," he said.

In addition, the National Handling Service (NHS), a subsidiary of the airline, would also be privatized to secure additional funds.

"Efforts to partially dispose of the National Handling Services should be pursued with urgency now in order to secure some financing from within the airline in order to avoid overburdening Treasury,” Goche said.



Advertisement


 
Email this to a friend Printable Version Discuss This Story
Share this article:

Digg it

Del.icio.us

Reddit

Newsvine

Nowpublic

Stumbleupon

Face Book

Myspace

Fark
 
 
 
comments powered by Disqus
 
RSS NewsTicker