VICTORIA FALLS, May 19 (The Source) – The government says it would exempt the technical partner being sought for Air Zimbabwe (AirZim) from empowerment laws as it seeks to revive the debt-ridden national airline.
AirZim, with debts estimated at about $200 million, has been battling to withstand competition from new low cost airlines that have taken over its most lucrative local and regional routes.
It has been scouting for potential suitors for the past decade, a search which intensified in the past year, but no deal has yet been struck, according to Transport and Infrastructure Development Minister Joram Gumbo.
In an address to the International Air Travel Association (IATA) conference, Gumbo said Cabinet has given him the green light to go ahead with the hunt for a partner but separately told reporters that the new investor would come in “at par” with the government of Zimbabwe, which owns a 100 percent shareholding in AirZim.
Gumbo said Zimbabwe had identified 12 potential partners but had not yet reached a deal with any of them.
“The Indigenisation Act on this deal is not coming in,” Gumbo told the reporters on the sidelines of the IATA conference.
“We are going to be looking for somebody who will partner us at par. We have identified 12 partners which we think are strong enough but this does not mean we have reached an agreement. We have just been given Cabinet approval and the terms of reference have been approved. Government is going to take over the debt that is troubling the airline,” Gumbo added.
The country’s controversial empowerment laws compel foreign investors to sell at least 51 percent of any business in Zimbabwe to local entrepreneurs.
However, President Robert Mugabe has recently backed down and allowed some sectors of the economy to negotiate with suitors the spread of shareholding in order to encourage investment.
He spoke after AirZim acting chief executive officer, Edmund Makona, urged African government to take steps to save national airlines, which he said played a critical role in facilitating trade and tourism in the region.