This archive report was first published on 4 September 2019.
Published on September 4, 2019, Kenya Airways has formally withdrawn its privately-initiated investment proposal from consideration by the Kenya Airports Authority (KAA).
The decision comes after the National Assembly adopted a report recommending the nationalization of the carrier, a move that Kenya Airways had previously expressed support for but not necessarily agreed with.
According to Kenya Airways Chairman Michael Joseph, the nationalization plan was forced upon the airline, and they now have to deal with it to stay afloat. 'Parliament opted for this, we didn’t want to be nationalized, it was forced on us and now we have to deal with this in order to ensure we stay afloat. If you ask these employees, no one wants to be under a parastatal,' he said.
The proposal, which aimed to allow Kenya Airways to run JKIA, was met with resistance from the KAA. The plan, however, opened up conversations around Kenya’s aviation sector, leading to the resignation of Kenya Airways boss Sebastian Mikosz and KAA head Johnny Andersen.
Aviation expert Githae Mwaniki opined that the nationalization will have Kenya Airways separate from JKIA and other entities, presenting an issue for the airline as they banked on this plan. 'The nationalization will have KQ separate from JKIA and other entities, this presents an issue for them as they banked on this plan,' he said.
With Kenya Airways expected to be back under state control, any CEO will be under state directions through the aviation holding company, ridding it of its current mode of operation. At the KAA, the curving out of JKIA from its control would mean a loss of its major revenue earner, leaving it with only Moi International Airport Mombasa, Kisumu International Airport, and Eldoret International Airport as key facilities.
The nationalization plan, if successful, will see Kenya Airways, KAA, JKIA Company, and the Aviation College all report to a holding company, effectively taking shine and control from KQ and KAA CEO positions. 'Nationalization can only address so much, whoever the board decides to bring in they have to know how the Kenyan market works,' added Mwaniki.
