in Business & Finance

Harare open to all forms of investment in Air Zimbabwe

Posted 25 January 2018 · Add Comment

The Zimbabwean government is open to all forms of partnership with Air Zimbabwe and is even prepared to waive a cap on 49% foreign ownership to entice investors to the ailing state-owned carrier, reports ch-aviation.

Since coming to power in November's de-facto military coup, President Emmerson Mnangagwa has sought to ease pressure on the national fiscus through, among other measures, the restructuring and privatization of underperforming and lossmaking parastatals. In a bid to lure more foreign investment into Zimbabwe, Minister of Finance Patrick Chinamasa said in his budgetary speech in December last year that the country will scrap its highly contentious indigenization policy which had curbed foreign participation in certain "reserved" sectors of the economy.

Minister for Transport and Infrastructural Development, Joram Gumbo, said the extent to which government is willing to divest equity in Air Zimbabwe will depend on the proposals put forward.

"We are open to all possibilities and all forms of partnership," he said. "But we will consider each on a case-by-case basis."

Among the options include the possible spinning off of Air Zimbabwe Technical Operations which oversees the carrier's MRO requirements and which operates two substantial hangars at Harare Int'l.

Although Gumbo confirmed that thus far, three serious bids have been tendered for the airline, he declined to name who they are. He also declined to comment on whether government had indeed committed itself to absorbing Air Zimbabwe's debt, estimated to stand at USD300 million. The resolution of the overhang has been cited as a significant stumbling block to any potential investment. 

In December, Gumbo told the local press that Air Zimbabwe was currently running at a monthly loss of USD2 million.

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