KQ applies for Sh7 billion emergency State bailout

Kenya Airways has asked the Treasury for a Sh7 billion emergency bailout after its aircraft were grounded due to the restrictions on international passenger flights sparked by the coronavirus pandemic that has killed over 280,000 people globally.

The Treasury is reviewing the application but has remained non-committal on whether it will offer the national carrier the money it needs for the maintenance of the grounded planes, payment of staff salaries and settlement of utility bills like security, water, electricity and parking fees.

Large aircraft pay $25 (Sh2,650) daily to park at airports like JKIA and $585 (Sh62,010) and $702 (Sh74,412) to land during the day and night respectively.

Besides the bailout, the airline is also seeking other incentives like tax breaks and waivers of navigation and landing fees. Without State aid, the airline risks running out of money in the near future against the background of banks’ uneasiness in lending to Africa carriers which are facing a plethora of challenges.

The International Air Transport Association has warned that the aviation industry may take years to recover from the Covid-19 pandemic and that African airlines could lose upto $6 billion (Sh636 billion) in passenger revenue this year alone, further compounding their woes.

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