THERE is little hope that national carrier, Air Zimbabwe, will get government-backed debt relief soon with a Cabinet minister saying such a possibility depended on the troubled airline securing a technical or equity partner.
Transport and Infrastructural Development Minister Joram Gumbo said there is little at the moment to raise hope that the debt relief Air Zimbabwe craves for and which many believed could set in motion its recovery, will come soon.
He said that the position remains that government is looking for a partner for the State air carrier, failure of which the airline has to trudge along on its own. There is no definitive time line when a partner could be secured.
Many unprofitable airlines remain in business because different stakeholders cannot afford to let them close for fear of job losses, associated inconveniences and national pride.
The government has for a long time been hunting for a technical partner to facilitate the rehabilitation of the national carrier whose recovery has also been choked by its heavy debt burden as well as obsolete air fleet.
Its small, mostly aged aircraft fleet includes the MA60, Boeing 737-200 (Advanced), Boeing 767-200ER and Airbus A320-200.
At some point, Cabinet considered taking over the airline’s toxic debts amounting to $300 million.
“The position remains that the government has no money at the moment and Air Zim continues to struggle like any other organisation in the country,” the minister said.
While many companies have struggled to cope with the punishing prevailing macro-economic conditions, Air Zim is among the generally poor performing parastatals whose turnaround has not progressed since 2010 when it was put on the the priority list.
“Air Zim needs recapitalisation and the government is looking for a partner. If we can’t get a partner we should get the money to revive it on its own. If we get a partner, government’s position is that the debt will be taken over so that we start on an equal footing,” he added.
While the national airline requires fresh capital injection running into hundreds of millions, it has struggled to secure just $10 million to clear its part of liabilities to resume flights on its old lucrative routes.
The debts include the $3 million owed to a United Kingdom navigation agency.
Minister Gumbo said negotiations, which have dragged since 2012, are ongoing to find common ground that should enable Air Zim to restart flights to London and later globally. Presently, it flies to Johannesburg, South Africa and domestic routes namely Vic Falls, Bulawayo and Kariba.