Privatization Tipped as Best Path for Air Zimbabwe Following Pilots Strike
Despite its serious financial problems, Air Zimbabwe is among just a few airlines in the world with a 100 percent safety record
Experts said Air Zimbabwe could readily be privatized, but the indigenization or black empowerment plan being energetically advanced by the ZANU-PF side of the government makes foreign investors queasy Air Zimbabwe commercial jets are in the air again following a three-week strike by pilots and cabin crew, but aviation experts say the future for the state-run carrier does not look bright unless Harare is willing to privatize by bringing in a strategic investor. Governmental financial intervention ended the strike by pilots, engineers and cabin crew. But economists and aviation experts say the only way the airline can run in the black is through privatization because it lacks sufficient capital to sustain operations. Despite its financial issues, Air Zimbabwe is one of a few airlines in the world with a 100 percent safety record. That could make the airline attractive to investors who might like to take a controlling stake and compete with regional carriers South African Airways. But the indigenization or black empowerment program being energetically advanced by the ZANU-PF side of the national unity government makes investors queasy. It calls for a controlling 51 percent stake in foreign companies to be taken by black investors, and the mechanism by which this transfer will take place remains murky at best. Air Zimbabwe has struggled to pay its air crews and other staff since the economy went into a steep dive in 2007, and remains burdened by political patronage. Most agree the airline, with US$100 million in debt, is insolvent and needs a major capital injection. Otherwise they predict that Air Zimbabwe will remain a burden to the government, which itself is operating on shoe-string budget and prioritizing social services. Independent economist John Robertson said it is unlikely the national airline can make any profit so long as it remains as heavily indebted as it is today.