Kenya Airways’ Joseph urges to select professionals onboard after nationalisation
Kenya Airways chairman Michael Joseph has urged that it must avoid selecting a board packed with politically-connected individuals after it is renationalised in order to ensure future success.
September 18, 2019: Kenya Airways chairman Michael Joseph has urged that it must avoid selecting a board packed with politically-connected individuals after it is renationalised in order to ensure future success.
The airline which is 48.9 percent government-owned and 7.8 percent held by Air France-KLM, was privatised 23 years ago but sank into debt and losses in 2014. Lawmakers voted to renationalise it in July.
Joseph said the requirement for professionals to be put in charge is being built into draft laws that will guide the renationalisation.
"We do not want to create a situation that we had before, where you nationalise the airline and all it becomes is a department of government. The board of directors is loaded by friends of politicians. It must be run in a commercial way," he addressed the media on the sidelines of an aviation meeting.
A failed expansion drive and a slump in air travel forced the airline to restructure $2 billion of debt in 2017. But the carrier still needed cash for fleet and route expansion amid growing competition from Ethiopian Airlines and Emirates.
Kenya wants to emulate countries like Ethiopia, which runs air transport assets - from airports to fuelling operations - under a single company, using funds from the more profitable parts to support others.
Under the model approved by lawmakers, Kenya Airways will become one of four subsidiaries in an Aviation Holding Company.
The others will be Jomo Kenyatta International Airport (JKIA), the country's biggest airport, an aviation college, and Kenya Airports Authority, which will operate all the nation's other airports.
Competition among regional carriers rose at the end of last month when Uganda Airlines resumed flights after almost two decades.
Joseph said such developments left Kenya without any choice but to renationalise its airline, in order to cut costs and survive in the crowded Africa aviation market, where carriers have the weakest finances and emptiest planes of any region in the world.
"If we don't do this we have no airline," he said.