Air Namibia can be saved – IPC
16 February 2021 | Transport
The Independent Patriots for Change (IPC) believes Air Namibia can be saved and that government’s decision to liquidate it does not serve in the best interest of the country.
The ministers of finance and public enterprise last week announced the liquidation of the airline, citing insolvency as one of the reasons for shutting it down. The move brings the national carrier’s 75 years of service to an end.
The airline made a loss of N$119 million, while its historic debt amounts to N$1.3 billion. Government will have to fork out N$2.5 billion to finalise its liquidation.
The airline has not made a profit since its establishment.
The IPC urged government to cancel the leases of two Airbus A330 aircraft as well as the Windhoek-Frankfurt route in an effort to save the airline.
“Cancel the Windhoek-Frankfurt route, return the two Airbus A330 leased aircrafts - or sublease them - while still continuing to honour the lease terms under new considerations.
“These two measures alone would save the company some 80% of operational costs,” the party said.
Another suggestion made is getting funding from the Government Institutions Pension Fund (GIPF) and NamPower.
“Encourage GIPF, NamPower and NamWater to provide a restructuring loan of N$2 billion. Allow dividends from other state-owned enterprises to be diverted [to] rescuing the airline,” the IPC said.
Exchange unused land
The party also suggested the exchange of unused land for share capital in the airline.
“Provide shares to private entities through exchange of unused farmland, allowing private share ownership. With private entities on board as shareholders, the board selection and leadership management team - including the choice of CEO - with clear corporate governance structures and operational systems in place will do away with poor team leadership and contribute to enhance staff spirit,” the IPC said.
The measures suggested would steer the airline to profitability, it said.
“There is a chance for the airline to break-even within three years and achieve reasonable profit margins by 2025… so there is light at the end of the tunnel and indeed many employees, including pilots - whose careers are being jeopardised - will retain their employment,” the IPC said.