Air Zimbabwe

From http://www.zimpapers.co.zw
Saturday, 27 August 2011
By Darlington Musarurwa

THE country’s sole national airline, Air Zimbabwe, currently giving policymakers a headache, is losing an estimated US$8 million per month to other competing regional and international airlines plying its routes, it has been learnt.

A report released last week by think-tank National Economic Consultative Forum (NECF), on The Issue of Traffic Rights in Zimbabwe and the Implications on Tourism and the

Overall Economy, noted that Government, through the Ministry of Transport, Communication and Infrastructural Development, is actively discouraging potential local operators who are willing to complement and ally with Air Zimbabwe by solely reserving routes such as Harare/ Bulawayo/Harare; Harare/Victoria Falls/ Harare; Harare/Johannes-burg/Harare; Harare/Lusaka/Harare and Harare/Dar es Salaam/Harare solely to the ineffective national carrier.
Though many aspiring operators have been able to get the necessary documentation to take to the skies, it is alleged that they have not been able to operate mainly because the Ministry of Transport has been “unwilling to grant them the necessary traffic rights”.

It is believed that Zimbabwe’s first low-cost airline, Fly Kumba, which was owned by Zimbabwean-born South African-based businessman Mr Lloyd Muchaka and Mr Patrick Chapwanya, folded early this year after being forced to ply alternative routes — considered unviable — to those serviced by Air Zimbabwe.
A cocktail of challenges dogging the national carrier has naturally handed most of the businesses to competing airlines such as Zambia’s Zambezi Airlines, South African Airways, South African Airlink and British Airways (Commair).
“As a country, Zimbabwe is losing potential earnings of over US$8 million per month to foreign airlines. This is tantamount to exporting labour or jobs to other countries, which Zimbabwe cannot afford at all.

“If retained in this country, this large amount could be used to generate a lot of job opportunities in the aviation sector as well as in other downstream industries. The amount could also boost the exchequer’s account tremendously,” read part of the NECF report.
It added that: “By the same vein, industry and commerce could be saved a lot of money through provision of reliable air transport to Bulawayo. This may have some effect on reversing deindustrialisation in Bulawayo.
“What may not be so obvious is the need to create a formidable alliance within the country to fight off competition. Granting traffic rights to other local players would mean creation of such an alliance and this move will be beneficial to all the players in the country.

“It is therefore recommended that Government review this area urgently and allow private players to complement the national airline. Furthermore, with an efficient airline system, given the regional central geographical location of Zimbabwe, it would be easier to implement the dry cargo hub concept for cargo that is flown into the country for further distribution by local feeder airlines into the region.”
Even though Government has reserved the Harare-Lusaka route for Air Zimbabwe, Zambian airlines — Zambia Airlines and Zambezi Airlines — have been dominant, raking in an estimated US$350 000 per month as compared to a meagre US$150 000 per month by the national airline.
As a result, Zimbabwe is considered to be a net payer to Zambia in terms of aviation revenue.

Due to the unreliable domestic service, most passengers are forced to travel via Johannesburg.
However, the country has a bilateral air service agreement (BASA) with Zambia that allows for Zimbabwe to appoint more than one operator to provide air services between the two countries (multiple designation).
Similarly, the same challenges are being experienced for the Harare-Johannesburg route, which is one of the most profitable in the region and is the lifeblood of Air Zimbabwe.
Zimbabwe and South Africa also have a BASA through which each country is allowed to operate up to 65 frequencies per week with multiple designations.

But currently the Zimbabwean side has only one operator with a total of less than 20 frequencies of week, while the South African side has three operators — South African Airways, South African Airlink and British Airways (Commair) — that have exhausted the South African quota.
In essence, the South African operators enjoy a 90 percent market share, while the remainder is for the local operator.
On the overall, while Air Zimbabwe generates US$825 000 per month on average, South African operators are generating about US$7,4 million in the same period.
Added the NECF: “Again it is very clear that on the Harare to Johannesburg segment, Zimbabwe is not benefiting at all as a country. Nearly all the revenue from this sector accrues to South Africa, and given that the majority of this segment are Zimbabweans, it is very clear that Zimbabwe as a country is a net payer while the South Africans are a net receiver.”

Crucially, most of the local cross-border traders who buy their wares in Tanzania are forced to use the Johannesburg or Nairobi routes at bloated costs since there are no services at all that are offered by the local operator for this route.
However, it is believed that potential operators have been denied permission to ply this route on the pretext that it is well serviced.
Aviation officials note that the Dar es Salaam market is about 150 passengers per week, which translated to US$330 000 per month to other countries.
The NECF also observes that the Harare to Bulawayo route is not being adequately serviced and, where serviced, the national airline has neither been efficient or reliable.

Most travellers have had to rely on road transport, a development that has negatively impacted on both business and commerce.
For one to operate an independent airline, there is a need for an air service permit from the Ministry of Transport, Communication and Infrastructural Development and an air operators certificate that is issued by the Civil Aviation Authority of Zimbabwe.
The ministry issues an air service permit after rigorously vetting the nationality, funding and viability of the proposals.
There has been increased focus on alternative operators of late since services from Air Zimbabwe have been indefinitely suspended because of the industrial action by the pilots.
Government is currently considering options to bail out the beleaguered carrier.-The Sunday Mail