The move to create a special investment vehicle made up of the Kenya Airports Authority (KAA) and Kenya Airways to take over the management of the Jomo Kenyatta International Airport (JKIA) has run into headwinds, with the opposition from Parliament and players in the industry growing.
The Parliament’s Public Investment Committee has suspended the process, pending a review while the Kenya Aviation Workers Union has moved to court to terminate the plan altogether.
The Government is pushing the deal, with Deputy President William Ruto insisting it is a win-win situation for both KAA and KQ as well as a lifeline for the latter that has been struggling under perennial losses in recent years.
“It would be irresponsible for us as a government to allow Kenya Airways to go down because if it happens, it will go down with our tourism, our horticulture sector and revenues to Kenya Airports Authority because 70 per cent of the revenue of KAA come from Kenya Airways,” said the DP last week.
However, a look at data from several sources, including reports from the KAA, KQ and Kenya National Bureau of Statistics (KNBS), indicates that the deputy president’s figure is exaggerated.
Data from the office of the Auditor General indicates that KAA recorded Sh13.48 billion in revenue in the year ended June 30, 2016, and posted Sh2.59 billion in pre-tax profit. The airport’s agency further moved 9.46 million passengers and 254 million kgs (254,000 tonnes) of cargo.
KAA’s schedule of charges and landing fees indicate the authority collects revenue from a variety of charges, including landing, parking, handling, security as well as fuel charges, among others.
The authority further handled 253,569 aircraft movements (landing and takeoffs) in the eight main airports and two airstrips over the 2016/2017 financial year, with passenger numbers standing at 8.6 million. Data from Kenya Airways’ annual report indicates the airline company moved 4.2 million passengers and 66,557 tonnes of cargo across the world over the same period.
This means even if all the aircraft movements originated from Kenya, KQ’s revenue contribution to KAA operations ranges between 25 and 50 per cent and not 70 per cent as claimed by the DP Ruto.