President Emmerson Mnangagwa has ordered Transport minister Jorum Gumbo to bring home Zimbabwe Airways (ZimAirways) planes secretly bought using public funds, while government investigates the dodgy deal that could collapse the debt-ridden flag carrier Air Zimbabwe (AirZim).
The dodgy project involving Air Zimbabwe (AirZim) and new airline Zimbabwe Airways is getting murkier, amid allegations that some senior government officials are deliberately sabotaging the debt-ridden national flag carrier to pave way for the new private airline, which will also be emblazoned with national colours.
Aviation sources told the Zimbabwe Independent this week that Zim Airways planes, which were bought using public funds provided by the Reserve Bank of Zimbabwe, will soon land in the country. The planes include four Boeing 777 bought in Malaysia and two Embraer ERJ145 bought from the United States.
Last year, the Independent reported that Transport minister Jorum Gumbo and former AirZim chief operating officer Simba Chikore, who is former president Robert Mugabe’s son-in-law, have been assisting in setting up the private airline at the expense of the flag carrier, AirZim, which fell under their purview and supervision, raising a serious conflict of interest on their part.
There were indications that following Mugabe’s ouster via a military coup in November last year, the deal had crumbled, as President Emmerson Mnangagwa and his deputy Constantino Chiwenga, were opposed to the arrangement. The involvement of their allies has, however, reportedly softened their stance.
Aviation sources say there was a well-calculated plan to destroy AirZim to the benefit of Zim Airways.
“The initial plan was simple; use money from RBZ to buy planes; register them under Zim Airways; get an air operator licence, then compete with AirZim, but because AirZim has one plane and they have six, AirZim would definitely lose out and eventually collapse,” said an aviation source.
“The plan has changed a bit and is now centred on ensuring that a partnership between AirZim and Zim Airways is reached along the way. Zim Airways will then bring in their planes and a bit of capital, thereby assuming control of the company, which will result in board and managerial changes.”
The plan, aviation sources say, also involves ensuring that AirZim does not get funding support to cripple its operations.
Information gathered shows that Zimbabwe Airways is owned by a local firm, Zimbabwe Aviation Leasing Company (ZALC). An enquiry with the Deeds Office in Harare indicated ZALC was registered under file number 3015/12. The file was, however, missing from the office, meaning the directors could not be immediately ascertained. Aviation experts say although it is saddled with debt, AirZim can be revived if the company’s strategic turnaround plan is implemented.
AirZim immediately requires US$45 million to be operational, according to AirZim’s Strategic Turnaround Plan (2018-2020). The airline requires US$26 million to settle its foreign debt; US$6 million to buy three Embraer ERJ145; US$4,6 million for International Air Transport Association (IATA) clearing house joining fees, among other financial obligations. Official documents show that as at December 2017, AirZim had local debt totalling US$341 million.
Among some of its weaknesses, according to the plan, are a shaky balance sheet, debt overhang, antiquated equipment, thin route network, high litigation, low level of automation and an absence from the IATA clearing house.
Locally-based German aviation expert Jerry Haas, who has been posting accurate accounts on the Zim Airways project, recently posted on microblogging website Twitter saying the Zim Airways deal was reaching finality.
“#ZimbabweAirways back on track. Documentation on the final stage. Should be cleared to take-off soon,” Haas twitted on March 21.
Initially Haas had tweeted that government would wind down AirZim before allowing Zim Airways, which is emblazoned with national colours to take to the skies. This initial arrangement had created a possible conflict of interest between Gumbo and Zim Airways.
Gumbo, however, insisted he would not allow the airline to collapse, although it was failing to attract partners. He said negotiations between AirZim and Ethiopian Airlines collapsed after the latter wanted to set up a regional hub in Harare, that could relegate AirZim to local routes, adding talks between Air Malaysia and the national flag carrier also hit a snag due to AirZim’s weak balance sheet.
“I will not allow AirZim to collapse. I approached 10 airlines to partner us, but only had some discussions with Ethiopian Airlines and Air Malaysia,” Gumbo said in an interview.
“I have other plans which came after the new dispensation, which is making my life easier. I have some people contacting us to assist, partner or purchase some planes. AirZim as a business, should be viable, but for that to happen, staff culture and attitude should change. That is what will assist us.”