Uganda Government considers acquiring equity in Air Uganda

The Government of Uganda is currently considering buying Meridiana Africa Airlines which is trading as Air Uganda as a way of increasing the international export volumes, reduce on the costs and revive a national carrier. According to Amelia Kyambadde who is the trade minister, it will do Uganda really good to have its own national carrier as it will increase trade volumes and for that matter the  Government is looking into acquiring equity in Air Uganda, first, for the operation of cargo services.

The proposal has been supported by the fresh fruit exporters, farmers as well as the tourism industry as they believe it will help boost their businesses as well as the country’s economy but at the same time, critics argue that a national airline is capital intensive with a low return rate therefore should not be spent on such large a mount of money.

The Uganda Airlines was closed in 2001 because of high maintenance costs and low revenues. But others like James Kanyije who is a proprietor of KK foods, a perishable food exporter, strongly believes that a national airline will significantly reduce costs associated with acquiring foreign exchange to pay to foreign fliers to transport their cargo. He said the Government should really support farmers who export agribusiness because it brings in a lot of foreign exchange.

Transport minister Eng. Abraham Byandala said the President Yoweri Museveni has met the Aga Khan about buying into the airline. The Aga Khan-run Air Uganda and is now the quasi national carrier having been in business for five years. The airline currently has two 50-seater planes and two 99-seater planes, flying to seven destinations in East Africa and in West Africa and Europe.