14 Nov 2013 18:50pm
WINDHOEK, 14 NOV (NAMPA) - Prime Minister (PM) Dr Hage Geingob said the future of Air Namibia looks positive, as the airline, through its management and Board, is working hard to identify strategies which can help improve the financial fortunes of the airline.
The Premier said this in his response to questions by Rally for Democracy and Progress (RDP) Member of Parliament, Anton von Wietersheim on the present and intended future strategy for Air Namibia.
Speaking in the National Assembly here on Thursday, Geingob explained that Air Namibia is currently in the second year of its current business plan, with most initiatives which needed implementation, having been implemented.
The management of Air Namibia is confident that the strategy adopted is starting to bear the desired fruits. For starters, the reputation of Air Namibia has turned positive in the market, he said.
Geingob added that aspects of reliability have been addressed, and people as well as companies have started selecting Air Namibia as their preferred airline.
According to him, interim financial performance statements produced for the first six months of this year show improvement, compared to the same period in 2012.
Revenue generated in the current year's first six months is N.dollars 782 million, compared to N.dollars 644 million over the same period last year, which represents a 21 per cent improvement.
He said that though still loss-making, the operating loss for the first six months of this year is N.dollars 69 million only, compared to N.dollars 323 million incurred over the same period last year - an improvement of 78 per cent.
Geingob stressed that Air Namibia operate in a highly-competitive environment and ever-increasing costs, which cannot be passed on to the customers immediately.
The airline, he indicated, historically had old aircraft which were expensive to maintain, and also had reliability issues.
With the new fleet at the airline, there is already a notable improvement in reliability, and confidence from the market is positive, said the PM.
Although profitability might not be achieved in the near future, what is important is that the country gets more value from Air Namibia than the amount of money which is being put into the airline, he stressed.
Geingob noted that for the past several years, grants given to Air Namibia went towards the purchase of new aircraft, adding that this will help guarantee the sustainability of future operations.
He made it clear that governments all over the world are very protective of flag carriers, and see them as a great way to project a national image or identity especially at foreign airports.
This, however, is not the only reason that governments protect their airlines - it is an industry that moves the worlds economy, creating employment for 5.5 million people, despite the fact that it is a difficult one for shareholders to make money, he explained.