Business News of Monday, 11 February 2013
Government, under a Public Private Partnership (PPP) initiative, is to set-up a new national carrier to tap into the booming aviation industry, Minister-Designate for Transport Dzifa Ativor has said.
“The government will partner the private sector to set up a national airline. We must avoid all those challenges like political interference and all other issues, “she said.
The Minister-Designate was answering questions about the future direction of the country’s aviation industry and the defunct Ghana Airways, before the Vetting Committee in Parliament last week.
Aviation is fast expanding amid Ghana’s strong economic growth: the number of carriers operating in the country has grown from 15 in 2000 to an estimated 40 this year, and passenger air traffic is expected to hit six million by 2015 -- an increase of more than 200 percent over the total passenger throughput of 1.8 million recorded in 2011.
The Ghanaian aviation industry, with an average growth per annum of 10 percent, is one of the fastest- growing and the most competitive in the West African sub-region.
According to the Minster-designate, government wants to involve the private sector in setting up the new airline to make it viable and efficient.
Aviation experts have said government only needs a carried interest, but the private sector must manage the new Ghana Airways.
Previously, GIA – the former Ghana Airways Limited, founded in 1958 -- had been the national airline with the Kotoka International Airport (KIA) as it hub. However, the airline, ridden with debt, ceased operations in 2004. Attempts were made to revive its fortunes, but to no avail; and in June 2005 the airline was liquidated.
In 2010, government signed a partnership agreement with Arik Air of Nigeria in an attempt to re-launch the Ghana Airways carrier, but the deal was stillborn.
Government has indicated that it is committed to settling all outstanding issues with the last national carrier, Ghana International Airlines (GIA) -- which suspended operations in May 2010 -- before proceeding to set up a new one.
The Ministry of Transport, has therefore, presented proposals to Cabinet, hoping to put to bed any lingering issues with GIA.
Analysts have welcomed the intention to set up a new national carrier, but have urged caution to avoid past pitfalls.
Commenting on the benefits of having a national carrier, Mr. Keith Williams, Group Chief Executive of British Airways, told the B&FT that establishing a national carrier is not out of place given the macro-economic stability and economic growth experienced in recent years.
However, any such initiative, he said, should be privately managed; and should take into account other carriers servicing popular routes in Europe and Asia from Accra -- then come out with a business model that will make it profitable.
The Country Commercial Manager of British Airways, Mr. James Wooldridge, also in an interview, said it will be prudent for a Ghanaian national carrier to focus on servicing routes within the sub-region and other African routes where there is a growing market and grow from there, rather than to join other operators servicing popular routes in Europe from the onset.