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Feature Article of Saturday, 15 January 2011

Columnist: Sakyi, Kwesi Atta

Ghana International Airlines - A Need For Resurrection?

Kwesi Atta Sakyi



6TH JANUARY 2011



The defunct Ghana Airways went under line the Titanic because of insider trading gross indiscipline and mismanagement. AS a public corporation, it had no Plc status and it was owned and controlled by the state. Ghana Airways, like many other public corporations, was funded by tax papers money and its inept operation and management made it a national liability. It became insolvent because managers and workers perceived it as a cash cow to be milked and not fed. Many a time, the flight to London was packed with relatives of crew and also abused their privilege as on their return trips to Ghana, they returned with tones of luggage after their shopping spree in London, New York more than excellent with their flawless take offs and landing, the airline suffered a lot of set backs. First, they could not keep to their flight schedules and I remember in the mid 90s, I was delayed for more than 6 hours on my flight from Accra to Harare. Besides, because the cash outflows were more than the inflows the airline was not a going concern. The planes became obsolete and they were even refused landing rights in New York because they did the minimum pollution standards.



The airline simply because a national disaster and it went under, which pressure from our multilateral partners to denationalize and sell off state assets which were loss making there was no option Ghana Airways despite its insolvency, was a source of national pride and a status symbol to all Ghanaians. Sad enough, it had to be sold. It may be recalled that the era of privatization started in the late 1970’s when Margaret Thatcher and Ronald Reagan were in power in the UK and USA respectively. They started new right improvement for the sale of public corporations in the era of small government, liberalization and deindustrialization. It was pathetic that in the case of developing, countries, the sale of those state enterprises was done in dubious circumstances with a few rich locals appropriating national assets to themselves by purchasing them cheaply. Some foreigners also chipped in to complete the loot. One remembers the sale of State Transport Corporation, Black Star Line, Water & Sewerage Corporation, Electricity Corporation, among many others. These enterprises were providing public and merit goods to help bridge the income gap between the rich and poor.



By then Ghana was a mixed economy and a welfare state. Currently, we are running a purely capitalist system and this has worsened income distribution in the country after selling the Ghana Airways to the private sector, Ghana International Airways came up as a substitute but it has not fared any better. GIA lacks funding as the new owners in Ghana and the USA have failed to raise enough capital to procure modern planes. Furthermore, the competition has been keen for them. What GIA has to do is to find a niche in the market to exploit and consolidate. Hopefully, 2011 should be an action year for the top management of GIA because we have heard enough of their dreams, mission and vision without seeing the implementation part of their strategic plan. I will advise GIA to seek to form strategic alliances with any of the major global players such as BA, KLM, Lufthansa, among others in order to gain economies of scale and scope. GIA needs to improve their service delivery so that they can get patronage from the Ghanaian travelling public. If possible it should float shares to the public and on the international capital market to raise the needed capital because the airline business is a service industry with great demands for huge capital injections to meet high quality standards. As matters stand, GIA has not been able to expand its market share and one wonders whether it has broken even – what with a multiplicity of competitors on the market and the magnetic attraction Ghana as an oil producer. I think GIA needs a shot in the arm for it to become a flag bearer for Ghana. 2011 is going to be a make or break year for GIA. I wish the top management all the best this year and we are looking forward to having more pro activity on their part. Having a national flag bearer is a desideratum for selling Ghana abroad as a serious investment destination.



By Kwesi Atta Sakyi



Email: attakas2003@yahoo.com

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