Investors flock Aviation Ministry over new national airline

The Aviation Ministry has received a number of proposals from investors seeking to partner government in the establishment of a new national airline.

The sector ministry, which is seeking to establish a national airline under a public-private-partnership (PPP) arrangement in order to realize the vision of making Ghana an aviation hub in the sub-region, is compiling the list of proposals for perusal by government’s Economic Management Team.

Aviation Minister, Cecilia Abena Dapaah, told the B&FT that: “We are now compiling the list. We want to establish a new national airline to restore the pride of Ghana in the skies and to provide jobs for our teaming youth. I would like to have more young people working in the industry and with the new national airline.”

Answering a question as to the ownership structure, Ms. Dapaah said: “The Economic Management Team will be in a better opposition to say after looking at the proposals. We will come up with the percentages after that.”

Ms. Dapaah was speaking on the sidelines of a visit to the Ghana Civil Aviation Authority (GCAA)--the industry regulator-- and its subsidiaries in Accra.

For decades, Ghana Airways was the national airline with the Kotoka International Airport (KIA) as its hub. However, the airline -- ridden with debt, ceased operations in 2004. Attempts were made to revive its fortunes but to no avail, and in June 2005 the airline was liquidated. The government with the support of private investors then established Ghana International Airlines (GIA). The airline faced difficulties and eventually suspended its operations in May 2010. Some loose ends in the liquidation process are still being tightened.

Ms. Dapaah said the new ‘modest airline’ will focus on operating flights from Accra to other destinations in the sub-region and growing from there.

The airline industry in the West Africa sub-region is growing. However, connectivity gaps still exist due, largely, to a weak aviation policy environment and traffic rights restrictions.

Despite the Yamasukuro decision reached some 20 years ago, to liberalise African skies for African Airlines, there are still restrictions that have limited intra-African flights.The navigational charges on the continent, and specifically the West African sub-region, also remain high.

The challenges notwithstanding, the population of the region presents a great opportunity for any new entrant. With an estimated 350 million people, most of which are under 30years, the region is one of the fastest growing aviation blocs on the continent.

The region is also a fast-emerging middle class. There are people with sizeable disposable income who have the ability to travel.

GCAA decoupling

The GCAA, which is the industry regulator, is also in-charge of Air Navigation Service provision within the Accra Flight Information Region (FIR).

However, the International Civil Aviation Organisation (ICAO) has been calling for the separation of the two functions to ensure operational efficiency and improved safety on the continent.

Air navigation service providers (ANSP) provide air traffic management; communications, navigation and surveillance systems; meteorological service for air navigation; and aeronautical information services among others.

Director-General of the GCAA, Simon Allotey told the B&FT that a committee has been constituted to oversee the successful decoupling.

“The Committee has gone very far with its work. Under the terms of reference, they are to ensure the sustainability and viability of both entities after decoupling. We have the sub-committee on finance that is to look at the organograms of both entities to ensure that they are efficient, effective and best address the needs of both entities.

The Committee has been working for the past six months and we have reached a stage where we want a consultant with knowledge of aviation, and the International Civil Aviation Organisation (ICAO) to come review the work done by the in-house decoupling committee. They will then finalize the report for on-ward submission to the GCAA board. After that, it will go to the Minister for Aviation for approval.