Hire scandal plunges Airzim into $20m debt •Airline charged $200k monthly since 2012 •Aircraft grounded in South Africa

Source: Hire scandal plunges Airzim into $20m debt •Airline charged $200k monthly since 2012 •Aircraft grounded in South Africa | The Herald May 13, 2016

Lloyd Gumbo Senior Reporter—
Air Zimbabwe has been leasing two airbuses at $200 000 each per month since 2012 from a Chinese company, Sonangol, which has seen the national airline accruing arrears as it is failing to break even, Parliamentarians heard on Wednesday.All things being equal, the national airline must have paid the Chinese firm about $20 million for the two aircraft by end of April this year. It is understood that one of the planes is grounded in South Africa after operating for about a month before developing a fault yet it is still accruing arrears.
The deal was sealed during the tenure of former Transport and Infrastructural Development Minister Nicholas Goche and was negotiated by jailed Hong Kong business tycoon, Sam Pa. Transport and Infrastructural Development Minister Dr Joram Gumbo told the National Assembly yesterday that the two aircraft were second-hand when they were leased to Airzim.

He was responding to questions from MDC-T MP for Bulawayo Nicole Jane Watson who sought to know whether Airzim bought the two aircraft. “The aircraft were not purchased but are being leased from China Sonangol since 2012,” said Dr Gumbo.

“These were part of efforts by Government to support the turnaround process of Air Zimbabwe. The aircraft are on a dry lease from China Sonangol at $200 000 per month per plane.” But legislators asked Minister Gumbo whether the national airliner was able to pay the lease fees per month.

Responded Minister Gumbo: “The aviation business is intricate and not doing well the world over. When this deal was agreed upon it was possible to meet the payments but as of now it is not possible. Those in the aviation industry are finding it difficult but it’s about us making a decision of whether we remain in the business or we pull out.”

One of the airbuses arrived in January 2012 while the second one arrived later that year. Dr Gumbo said Cabinet on Tuesday gave his ministry the go-ahead to engage partner for Air Zimbabwe as part of its turnaround strategy. Zanu-PF MP for Chegutu West, Cde Dexter Nduna, also asked Minister Gumbo to give an update on the completion of the Victoria Falls Airport.

“The $150 million project financed by a China Eximbank concessionary loan facility, is progressing well and overall progress to date is that the runway, the terminal building and the air traffic control tower were completed and are now in use since December 2015.

“The conversion of the old terminal building into a domestic terminal has now commenced. This together with a bigger fire station and expanded car park should be completed by May 31, 2016,” said Minister Gumbo.