Wednesday May 8, 2019
Kenya Airways planes are seen parked during a pilots strike organised by Kenya Airline Pilots Association (KALPA) at the Jomo Kenyatta International Airport, Nairobi, on April 28, 2016. PHOTO | REUTERS
NAIROBI (Reuters) - The Kenyan parliament’s transport committee has opposed a proposed takeover of the running of Nairobi’s Jomo Kenyatta International Airport (JKIA) by struggling carrier Kenya Airways, a lawmaker told Reuters on Tuesday.
The airline, in which Air France-KLM holds a 7.8 percent stake, was forced to restructure $2 billion worth of debt in late 2017 after a slump in Kenyan air travel following several attacks by Islamist militants from Somalia.
The cabinet backed a plan last year to hand over management of the profitable airport, the largest in the country, to the loss-making national carrier to revitalise its balance sheet and allow it to buy new planes and open new routes.
Kenya Airways wants to emulate rival carriers who operate airports, taking advantgage of profitable services such as catering, fuel distribution, cargo and maintenance.
The transport committee had instead proposed that the carrier should be exempt from paying taxes to allow it to recover, said the member of parliament who did not wish to be named.
“To save the airline, they should seek the Treasury’s exemption from tax payments for some time so that they can recover,” said the lawmaker.
The committee argued that the airline should stick to its core business of ferrying passengers and cargo, adding that JKIA was a security installation that should not be handed over to a private entity, the legislator said.
The committee’s report will soon be considered by parliament.