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Business News of Thursday, 21 November 2019

Source: www.citibusinessnews.com

Government considers private sector funding for new aircraft for national airline

The Ministry of Aviation says government is considering allowing private investors to fund the new aircraft to be purchased for the new national airline.

The government on Tuesday November 19, 2019, signed a Memorandum of Understanding which will see the purchase of six Dash 8-400 aircraft at the Dubai Airshow and three dreamliners.

The new home-based carrier will have minimum government interference as the state is expected to own ten percent stake with private investors and a strategic partner, Ethiopian Airline, owning the remaining ninety percent.

Though funding issues are yet to be concluded, the sector Minister, Joseph Adda, has told Citi Business News the option to offload the cost to a private investor, is aimed at reducing pressure on the public purse.

“We’ve assessed all the options, put them out there to be laid before cabinet for it to assess. The Ministry of Finance would have the input as to what they can afford. There are investors in Ghana who can pull the money so we don’t have to burden the Ministry of Finance. This is going to be largely a private sector operation.”

Mr. Adda also disclosed that some domestic airlines are in talks with his ministry for possible partnership.

“So all this will depend on the investors and what they choose as the best way to fund the aircraft. We should not say that we have a firm investor interest in terms of releasing some funds into the account for now. But we do have some showing interest that they are hungry for the airline and they want to be part of it. Some we’ve already signed an MoU with the likes of Ethiopian Airline.”

Meanwhile, a search is still ongoing on how the new national airline will be called.

“So we’re happy that this has brought us to one tip of the bridge, so once we conclude the procurement, then we cross over to the next end of the bridge which means that we’re now airborne with a home-based airline. The name itself we’re waiting to discuss that at the government level, and gathering some inputs from different parties.”