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Kenya’s Parliament to Nationalize Country’s Main Airline Kenya Airways

A failed expansion drive and a slump in air travel forced it to restructure $2 billion of debt in 2017

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Kenya, Airline, Parliament
FILE - Kenya Airways planes are seen parked at the Jomo Kenyatta International airport near Kenya's capital Nairobi, April 28, 2016. VOA

Kenya’s parliament voted on Tuesday to nationalize the country’s main airline Kenya Airways to save it from mounting debts.

The loss-making airline, which is 48.9% government-owned and 7.8% held by Air France-KLM, has been struggling to return to profitability and growth.

A failed expansion drive and a slump in air travel forced it to restructure $2 billion of debt in 2017. The airline later proposed taking over the running of Nairobi’s main airport to boost its revenue.

Parliament’s transport committee, however, rejected that plan, recommending instead the nationalization of the airline in a report debated by the national assembly on June 18.

Kenya, Airline, Parliament
Kenya’s parliament voted on Tuesday to nationalize the country’s main airline Kenya Airways to save it from mounting debts. Pixabay

In a voice vote taken on Tuesday afternoon, the majority of lawmakers in the chamber voted to accept the report.

Kenya Airways Chairman Michael Joseph told Reuters the vote was “great news.”

“Nationalization is what is necessary to compete on a level playing field. It is not what we want, but what we need,” he said, referring to competitors such as Ethiopian Airlines which are state-run and profitable.

Air France-KLM could not immediately be reached for comment.

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The government will now draw up an implementation plan, with clear time lines, said Esther Koimett, the principal secretary at the ministry of transport.

“Parliament is our boss … we will obviously take the recommendations of parliament,” she told Reuters.

Kenya is seeking to emulate countries like Ethiopia which run air transport assets from airports to fueling operations under a single company, using funds from the more profitable parts to support others, such as national airlines.

“The government is keen to take a consolidated view of aviation assets of the country in order to make sure they work in a coherent and efficient way to support the (Nairobi aviation) hub,” Koimett said.

Kenya, Airline, Parliament
The loss-making airline, which is 48.9% government-owned and 7.8% held by Air France-KLM, has been struggling to return to profitability and growth. Pixabay

The committee’s report proposes that Kenya set up an aviation holding company with four subsidiaries, one of which would run Kenya Airways. Another arm of the holding company would operate Nairobi’s main international airport.

The committee’s report also recommended the holding company be given tax concessions for a period to be determined and that it be exempted from paying excise duty on all goods, including jet fuel.

Koimett dismissed concerns that nationalization could lead to further mismanagement. Kenya’s state-owned enterprises sector is riddled with corporate corpses and near failures caused by theft and poor management over the decades.

“Implementation is really the key thing … Ultimately all these things have to do really with ensuring that we get the right people in the right places,” she said.

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($1 = 103.7000 Kenyan shillings) (VOA)

Next Story

New Rule in USA to Allow Passengers to Bring Pet Animals on Flight

New Rules Could Bump Emotional-Support Animals From Planes

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Animals
Airlines can now let passengers bring other animals on board, but hefty fees would apply. Pixabay

The days of passengers bringing rabbits, turtles and birds on planes as emotional-support animals could be ending.

The U.S. Department of Transportation on Wednesday proposed that only specially trained dogs qualify as service animals, which must be allowed in the cabin at no charge. Airlines could let passengers bring other animals on board, but hefty fees would apply.

Airlines say the number of support animals has been growing dramatically in recent years, and they have lobbied to tighten the rules. They also imposed their own restrictions in response to passengers who show up at the airport with pigs, pheasants, turkeys, snakes and other unusual pets.

“This is a wonderful step in the right direction for people like myself who are dependent on and reliant on legitimate service animals that perform a task to mitigate our disability,” said Albert Rizzi, founder of My Blind Spot, which advocates for accessibility for people of different ability levels.

Animals
Airlines say the number of support animals has been growing dramatically in recent years, and they have lobbied to tighten the rules. Pixabay

Tighter rules praised

The U.S. airline industry trade group praised the tighter rules. Industry officials believe that hundreds of thousands of passengers scam the system each year by claiming they need their pet for emotional support. Those people avoid airline pet fees, which are generally more than $100 each way.

“Airlines want all passengers and crew to have a safe and comfortable flying experience, and we are confident the proposed rule will go a long way in ensuring a safer and healthier experience for everyone,” said Nicholas Calio, president of Airlines for America.

Flight attendants had pushed to rein in support animals, too, and were pleased with Wednesday’s proposed changes.

“The days of Noah’s Ark in the air are hopefully coming to an end,” said Sara Nelson, president of the Association of Flight Attendants. The union chief said untrained pets had hurt some of her members.

Veterans groups pleased

Veterans groups have sided with the airlines, arguing that a boom in untrained dogs and other animals threatens their ability to fly with properly trained service dogs. Last year, more than 80 veterans and disability groups endorsed banning untrained emotional-support animals in airline cabins.

“It’s just interesting how people want to have the benefits of having a disability without actually losing the use of their limbs or senses just so they can take their pet with them,” Rizzi said.

Southwest Airlines handles more than 190,000 emotional support animals per year. American Airlines carried 155,790 emotional support animals in 2017, up 48% from 2016, while the number of checked pets dropped 17%. United Airlines carried 76,000 comfort animals in 2017.

Department officials said in a briefing with reporters that they are proposing the changes to ensure safety on flights. They also said some passengers have abused the current rules.

The public will have 60 days to comment on the proposed changes, and they could take effect any time after that.

The Transportation Department proposes a narrow definition of a service animal — it would be a dog that is trained to help a person with a physical or other disability. Passengers who want to travel with a service dog will have to fill out a federal form on which they swear that the dog is trained to help them with their disability. A dog that is trained to help a passenger with psychiatric needs would continue to qualify as a service animal.

Animals on Planes
Oscar the cat, who is not a service animal, sits in his carry on travel bag after arriving at Phoenix Sky Harbor International Airport in Phoenix. VOA

Note from medical professional

Currently, passengers have been allowed to bring many other animals if they have a medical professional’s note saying they need the animal for emotional support.

The proposal would prohibit airlines from banning particular types of dog breeds — Delta Air Lines bans pit bulls, for example — but airline employees could refuse to board any animal that they consider a threat to other people.

The president of the Humane Society of the United States said airlines had “maligned” pit bulls by banning them. Kitty Block said the Transportation Department’s rule against breed-specific prohibitions “sends a clear message to airlines that their discriminatory practices are not only unsound, but against the law.”

The new rules would also bar the current practice by many airlines of requiring animal owners to fill out paperwork 48 hours in advance. A department official said that practice can harm disabled people by preventing them from bringing their service dog on last-minute trips. But airlines could still require forms attesting to an animal’s good behavior and health, which could present challenges if the form has to be completed by a specific institution, Rizzi said.

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The proposal also says people with service animals must check in earlier than the general public, and would end the rarely seen use of miniature horses as service animals, although a Transportation Department official indicated the agency is open to reconsidering that provision.

Airlines could require that service animals be on a leash or harness and fit in its handler’s foot space. They could limit passengers to two service animals each, although it is unclear how often that happens under the current rules. (VOA)