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Air Namibia in financial storm

26 November 2015 Author   Sonja Angula

front  27 nov Sydney  november 2Namibia Airports Company (NAC) has threatened to ground Air Namibia aircraft as the airline is struggling to services its debt to the airports company.

 

An NAC executive said this week that the national carrier’s operations could be grounded to force them to honour their financial obligations.

“The financial relationship between NAC and Air Namibia is not sound. We confirm that Air Namibia is not honoring its obligations in respect of ground handling, rental, passenger and landing fee agreement and the amount owed is substantive,” Namibia Airports Company’s Strategic Executive of Business Strategy Toska Sem said.

Sem would, however, not disclose how much NAC is owed by Air Namibia, but said the amount was “substantial”.

The Windhoek Observer is reliably informed by insiders at the airports company that they are owed around N$80 million.

“We are in talks with our sister company, Air Namibia, regarding the matter. It is worth noting that both parastatals report to the same shareholder, Ministry of Works and Transport.

“Should our efforts prove futile, one of the alternative measures available is to ground Air Namibia operations to force them to honour their obligations.

‘’Another alternative we may pursue is to engage a professional company to collect passenger fees from all airlines and pay it directly to NAC to ensure that we receive passenger fees on time to improve our cash flow,’’ Sem said.

NAC Chief Executive Officer, El Kallawi confirmed during a telephonic interview that the national airline owed them money.

“Yes it is true, they do owe us money,” Kallawi said.

Public Relations Officer at the Ministry of Works and Transport Julius Ngwedha said Air Namibia should just pay NAC.

“Air Namibia must pay what they owe NAC, there is nothing special about them. They should pay until such time they approach us about having problems with such debts,”Ngwedha said.

Head of Corporate Communications at Air Namibia, Paulus Nakawa said in an email response to questions that details regarding what the national flag carrier owes are not to be made public.

“We enjoy good and cordial business relationship with the Namibia Airports Company. NAC provides various facilities to Air Namibia and other airlines to ensure the smooth landing, parking and taking off of our aircrafts.

“Like any other business and due to the transactional relationship between these two institutions, details regarding our suppliers are not to be made public as per various agreements in place between our institutions,”Nakawa said.

When asked whether Air Namibia would pay what it owes to NAC, Nakawa said they will honour the services rendered to them.

“Like any other creditors for Air Namibia, we honour the services rendered to us by the NAC through payment,”Nakawa said.

Namibia Airports Company is responsible for the development and management of eight airports in Namibia.

Their main objectives are to ensure that the arrival, surface movement, parking or departure of aircraft, the servicing of aircraft, including the supply of fuel and lubricants, ground handling of aircraft, passengers, baggage and cargo are well managed.

Both NAC and Air Namibia are state-owned enterprises under the custodianship of the Ministry of Works and Transport.

WINDHOEK OBSERVER

The Windhoek Observer is an English-language weekly newspaper, published in Namibia by Paragon Investment Holding. It is the country's oldest and largest circulating weekly.

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