Editor’s Note: June 11, 2019

Kenya Airways faces more headwinds

Kenya Airways hopes to double the size of its fleet to around 80 planes in the next five years as it tries to compete with bigger regional rivals like Ethiopian Airlines. Doing so will mean finding “the right financial structure”, chairman Michael Joseph said on Monday.

Easier said than done.

Last month, lawmakers rejected a proposal to operate Jomo Kenyatta International Airport, a bid to emulate the likes of Ethiopian Airlines and Emirates. These rely on running profitable services like catering and maintenance to subsidize their business.

In the absence of such a deal with the government, doubling its fleet is a pipe dream. 

The company is struggling to manage mounting debt, posting a $75m loss in December 2018. Things haven’t been helped by the unexpected resignation of CEO Sebastian Mikosz – brought in to turn around the airline – five months before the end of his three-year contract. 

Additional hurdles come from mounting competition and a tough business environment. African airlines will record their fourth annual loss in a row this year according to the International Air Transport Association. This despite the industry heading for its tenth consecutive profitable year.

It’s premature to write off Kenya Airways, but against this backdrop, and with a government under pressure to cut public spending, the carrier faces some serious headwinds.

From The Continent

Rwanda on Monday temporarily reopened its border with Uganda in an apparent easing of tensions between the two countries over the busy Katuna crossing. This has resulted in various accusations of destabilisation efforts by both sides. More: Africanews


Ethiopia has postponed a planned census in 2019 by a year, the second such delay, citing security concerns. The postponement raises concerns about the country’s ability to hold scheduled 2020 elections, the first under reformist prime minister Abiy Ahmed. More: Xinhua

The Daily Stat

1%

South Africa’s expected growth in 2019 according to ratings agency Moody’s, a downward revision from 1.3%. More: Reuters

The Global Perspective

Zimbabwe is considering withdrawing from the Convention on International Trade in Endangered Species as the organisation is barring it from selling $300m worth of ivory.This is part of a broader push by Southern African countries to have ivory trade restrictions eased, arguing that it is a vital source of income. More: Bloomberg

US assistant secretary of state for Africa Tibor Nagy will visit Sudan this week to help mediation efforts between the military and opposition groups over a transition to civilian rule. Talks have collapsed amid a deadly crackdown on protesters. More: BBC

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