Kenya Airways (KQ) has reignited controversy with its proposal to operate Jomo Kenyatta International Airport (JKIA) under a 30-year concession agreement, a move that has drawn sharp criticism from employees and stakeholders. The plan, approved by Cabinet, would see the Kenya Airports Authority (KAA) retain ownership of airport assets, with KQ managing operations. However, opponents argue the arrangement risks undermining the airline's financial recovery and public interest.
KQ Chief Executive Sebastian Mikosz clarified that the deal does not involve transferring airport assets to the airline, stating, "The building and all the land will remain owned by KAA and ultimately by the Government." Despite this, the proposal has faced pushback, with critics alleging it serves private interests rather than addressing systemic challenges plaguing the airline.
The airline's financial struggles date back to 2017, when it defaulted on Sh16.7 billion in loans from 11 local banks. Lenders were compelled to convert debts into a 38.1% equity stake following protests, with major banks like Equity (Sh5.2 billion) and National Bank (Sh3.5 billion) among the affected. The government also converted Sh77 billion in guaranteed debt into shares, increasing public ownership to 48.9%.
The concession plan follows years of interventions, including efforts to disentangle KQ from European airline KLM, which had controlled the carrier since its 1996 privatization. Legal challenges and financial mismanagement have plagued KQ, with recent disputes over airport operations heading to court. Critics argue the latest proposal prioritizes shareholder interests over sustainable solutions for the airline's long-term viability.
