Kampala considers acquiring A330s, CRJs for Uganda Airlines

Kampala considers acquiring A330s, CRJs for Uganda Airlines

Oct 25, 2016: Based on the recommendations made in an inter-ministerial report concerning the proposed relaunch of a new national airline, the Uganda government could acquire up to six aircrafts. Quoting excerpts of the report, the Uganda Monitor newspaper said last week that Yoweri Museveni's government may source upto UGX1.1 trillion shillings (USD331 million) from various financial institutions, one of which could be the Eastern and Southern African Trade and Development Bank, more commonly known as the PTA Bank.

“Government will purchase the aircraft using loan finance sourced internationally at an interest rate of 5 per cent per annum and over periods of 7-10 years (One A330-200 cost is estimated at USD109.5 million (UGX372 billion). Two are required, while a CRJ-900 at USD27.96 million (UGX95 billion), with aircraft needed under the plan,” the report said.

The government also intends to contribute USD70 million as start-up and working capital for the airline apart from the USD330 million in fleeting costs. East African state has been without a de-facto flag carrier since the Ugandan Civil Aviation Authority grounded the Aga Khan Foundation's Air Uganda project in 2014. Despite Uganda’s eagerness to redress the situation, opponents of the project have pointed to government's poor track record in running an airline. The debt ridden Uganda Airlines (QU, Entebbe/Kampala) collapsed back in 2001 which critics blamed on poor management.

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