Government under pressure to revive Uganda Airlines

A Uganda Airlines aircraft. Plans are underway to revive the national carrier with Uganda Development Corporation at the forefront. Internet PHOTO

What you need to know:

Span. The country has been without a national carrier since 2001.

Kampala. The government can no longer contend with the fact that the country does not have a national carrier,
Daily Monitor has learnt that President Museveni also believes the country is better off with the national carrier than without it.
While meeting government senior officials before the recently concluded Northern Corridor Infrastructure Project (NCIP) Summit in Nairobi Kenya, Mr Museveni said it is time to have Uganda Airlines revived so as to counter the exploitation Ugandans are subjected to while flying in other carriers.
On his Facebook wall, the chief executive officer of Uganda Tourism Board, Mr Stephen Asiimwe, posted that while the government senior officials and ministers were meeting in preparation for the concluded summit, the attention of the President was drawn on exorbitant fares airlines are imposing.
He wrote: “While briefing the President, the leader of the delegation Hon Sam Kutesa, Minister of Foreign Affairs said that despite prior arrangements under NCIP, the air service fare in the region have shot up again raising concern of the regional leaders.”
He continued: “President Yoweri Kaguta Museveni has said that Uganda will soon revitalise Uganda airline to counter the rising air service fares.”
The President also emphasised the need for Ugandans to access the regional market, saying it is not something to lobby for but a necessity for Ugandans involved in business.
According to Mr Asiimwe, the President made those pronouncements when he met the Ugandan delegation on the sidelines of the 11th Northern Corridor Infrastructure Projects Summit at Safari Park Hotel in Nairobi couple of days ago.
Meanwhile, the Uganda Development Corporation (UDC) acting chief executive officer, Mr Fred Ogene, has said the President has already directed that the defunct Uganda Airlines be revived. Speaking in an interview yesterday, he disclosed that UDC has already handed over the task to oversee the revival of the national carrier to the Ministry of Transport. He said anything to do with the Uganda Airline revival is now the responsibility of the Transport ministry.


In an earlier interview with the Daily Monitor, State minister for Transport Stephen Chemoiko Chebrot, government has hired global audit firm, Ernst & Young to evaluate the viability of the airline and “the results were astonishing”.
He added that his ministry was preparing a Cabinet paper which, he expected, will be in this month.
However, it is not clear yet whether this has since become a reality as he had hoped or business as usual much talking and less action. Mr Chebrot also revealed that the government was looking at an average of $300m (Shs1trillion) as the initial injection of the national carrier revival.
The airline, according to him, shall initially be a sole government business venture overseen by Uganda Development Cooperation but, “we will sell off shares progressively to the private sector until it is out of government control”.
He continued: “The country cannot afford to be both land and air locked.”

The exit
In May 2001, government liquated Uganda Airlines. At the time of its liquidation, Uganda Airlines was hugely indebted with a $6m (Shs21b) debt on its book.
The debt, according to former managing director Benedict Mutyaba, had been reduced from $12m (Shs42.8b), which had accumulated over the years. The liquidation, although a painful reality, did not settle in well with a number of stakeholders, who blamed government for deliberately killing the airline.