Air Namibia, the national carrier of the Southern African nation, Namibia is ceasing operations from February 11, 2021, according to the management of the airline. The cessation of operations of the airlines brings to the fore struggling African countries’ national carriers. Many of these airlines are on the brink of collapse even after public funds have been injected into them. Problems have been worsened by the COVID-19 pandemic which is making the likes of South Africa Airways, Kenya Airways, and many others to be a huge drain pipe to their respective governments.
A statement made available to AirInsight stated, “The Air Namibia management has just announced the airline will cease operations tomorrow, leaving over 600 employees without jobs following a cabinet decision to file for voluntary liquidation. Effective Thursday morning, all flight operations will be cancelled, with all aircraft returning to base. The reservation system for taking new bookings is also suspended. The carrier urged affected passengers to register their claims for refunds to firstname.lastname@example.org or email@example.com.”
According to the leaked documents, the Namibian Cabinet decided that the airline’s workers would enjoy preferential treatment and receive their full severance packages from the liquidators. “We will also explain that Cabinet approved for the employees to receive ex gratia payments equal to the value of 12 months’ salary and that this amount will be disbursed over a 12-month period,” the documents read. Moreover, the shareholder said it would ensure there’s no salary payment gap when the liquidation is activated. “If the liquidator can’t pay, the ex gratia payments would be activated,” it said.
The Ministry of Public Enterprises, the Ministry of Finance, Air Namibia’s executive committee members, the board, and unions will meet on Thursday afternoon for the government to give its stance on the matter and the way forward on liquidation. “All efforts must be made to protect the assets of the company,” the documents say. The interim chief executive officer has been directed to detail a plan of action and coordinate the way forward with the board.
Meanwhile, the public enterprises’ ministry allegedly appointed lawyer Norman Tjombe, businesswoman Hilda Basson-Namundjebo and businessman James Cumming to the airline’s board.
AirInsight recently reported on at-risk national carriers in Africa that are on the verge of liquidation. One of them was Kenya Airways. Africa’s airlines have been pushed to the precipice; no thanks to COVID-19. Many of them have been piling on debts long before the pandemic. Governments’ bailouts have been the oxygen sustaining them.
Questions are swirling in Africa and elsewhere over the financial wisdom of sustaining prestige carriers that often have a tiny share of the aviation market that sees no recovery in sight. The advent of COVID-19 may have found expression in the deafening noise that national carriers are a drain on states’ resources.
The sing-song in Africa, for now, is a national carrier. Governments may need to ask if there’s still value to having a national carrier other than patriotism or pride. And they may wonder whether it still makes sense to prop up airlines as more countries open their skies to new entrants and foreign carriers. The Nigerian government is making an attempt at a national carrier. It’s clear the government is driving it and wants its own national brand with a global reach.