The Malawi government will disband Air Malawi and establish a new airline in which it will have 51 percent stakes, website of The Nation newspaper of the country reported Thursday.
In his wrap up statement to Parliament on Tuesday, Finance Minister Goodall Gondwe said Air Malawi has failed the country and a new airline will be a solution to retain a flag carrier.
He said since 2004, the government has spent considerable sums of money to ascertain the viability of the company.
He said the board of Air Malawi as well as management have tried their best with various experiments to bring normality into the company despite short spells of cash flow improvements that have been advertised as profits.
"But in the end these too have failed and the financial situation is now threatening the safety of its passengers. In the circumstances, it seems proper for the government to make a long term decision on the matter that will satisfy both demands.
"We feel that a new airline could be re-established in which the government will retain a 51 percent share and a strategic investor would be allowed to own 49 percent of the shares. The government would thus have a majority on the board of the airline that would strictly be run on a commercial basis. In pursuing this deal, we are looking at what other countries have done such as Nigeria, Kenya, Zambia, Ghana etc," said Gondwe.
For almost 30 years, Air Malawi has failed this country to deliver services that are reliable and has from time to time failed even to procure basic operational materials such as fuel without government's support.
"Indeed again and again it finds it difficult to even maintain its membership of IATA and continues to damage the good name of Malawi by ignoring its advertised time-tables. The comments it attracts internationally have been unflattering. It is because of these problems that the government decided to privatise Air Malawi and searched for an investor to purchase it. It was however not successful as prospective buyers found the airline unviable," said Gondwe.
He said now the question of how Air Malawi should be handled has been a difficult one.
"On one hand it has been argued that the airline should be maintained under any circumstances as it is our flag bearer around the continent, that we should not sell the public asset to foreigners and that we should therefore save and improve it at any cost.
"This is an understandable view and one which is shared by many. It is an emotional view, but understandable. On the other hand it can be argued equally legitimately that we must have an airline that provides the public with an efficient and reliable service throughout the country and one that is not a burden on the public finances so that it does not compete with our ability to assure the public the basic needs of life," he said.
Since then, a number of groups have expressed interest to buy the airline, among them the company's managers and two local consortia.
Source: Xinhua
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