The Centre for Trade Policy and Development (CTPD) says the relaunching of Zambia Airways might be just like the Sales Tax reversal because the project’s funding model remains elusive.
And CTPD has cautioned government to stop ignoring concerns raised by citizens on the relaunch of Zambia Airways.
In a statement, CTPD researcher Bright Chizonde observed that Zambia Airways was likely to end up suffering the same fate as the controversial Sales Tax policy which government withdrew last year as the airline’s financing options remained elusive.
He wondered why government kept on insisting on pushing for Zambia Airways’ re-launch when the general citizenry still did not know the source of funds to jump-start the project.
“CTPD is greatly concerned with the poor management of the decision to relaunch Zambia Airways. The limited consultation, poor planning, lack of transparency, inclusiveness, and limited engagement with the public parallels the decision to introduce Sales Tax. Just like the decision to replace VAT with Sales Tax, the relaunch of Zambia Airways has been postponed many times on account of poor projections and planning-all in the midst of an adamancy to implement the decision regardless of the views of critical stakeholders. Government claims to have a comprehensive business model and financial projects, but these have not been presented to key stakeholders or the general public, the same way as the much-talked about Sales Tax simulation, which were never made public,” Chizonde stated.
“CTPD is also concerned that even at this stage, the financing options for Zambia Airways continue to be elusive. Considering the recent default on only US $1.4 million towards servicing the African Development Bank (AfDB) loans, and drag in sourcing funds for electricity importation from South Africa, Zambians should, indeed, be wondering how government seeks to finance the lease of plans and operations of Zambia Airways. It is surprising that government has continued to push for the relaunch of Zambia Airways through establishing a board of directors and recruiting employees, who are already drawing salaries, when the general public does not know the source of these funds.”
And Chizonde said government should be more accommodating of divergent views for better refinement of their plans.
“If Zambia Airways is to succeed, government should become more accommodating of divergent views for the betterment and refinement of their plans. We, therefore, urge the government to make public the business plan, the lease agreement, the management agreement, and MoUs signed with Ethiopian Airlines and others because they are a number of local aviation experts, who are well able to advise government on these critical areas. CTPD also advises IDC and the Ministry of Transport and Communications to stop ignoring public concerns regarding the decision to relaunch Zambia Airways,” stated Chizonde.
“Considering government’s fiscal position and Zambia’s current economic situation, CTPD will continue to advise government to halt its decision to relaunch Zambia Airways and focus on improving its plans through background work and stakeholder consultation, until such a time as would be economically and fiscally allowing for the relaunch. This recommendation was arrived at after detailed assessments of the economic environment, fiscal position, and case studies of South African Airways, Ethiopian Airlines and Malawian Airlines, the latter being a classic case of an Ethiopian partnership, which has failed to generate profits. It has also been established that the Ministry of Transport and Communication, and IDC are not in agreement concerning the appropriate business model.”
