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Kenya Airways has urged the government to reinforce the ‘Fly Kenya Policy,’ introduced in 2016, to prioritise the national carrier for air travel by government ministries, departments, and agencies, as stipulated in the Public Procurement and Asset Disposal Act.
Kenya Airways CEO Allan Kilavuka noted that despite qualifying for preferential treatment under the law, compliance with the policy is only at 30 per cent, primarily due to a lack of enforcement mechanisms and inflated travel agent markups.
Appearing before the Senate Transport Committee, Kilavuka also highlighted the airline’s request for a Special Economic Zone. He said they had written to the National Treasury to register certain activities at Jomo Kenyatta International Airport (JKIA). This would eventually extend to Moi International Airport, Kisumu International Airport, and the Pride Centre in Embakasi.
“Kenya Airways aims to venture into the specialised field of engine repair and overhaul, not only servicing our fleet but also third-party carriers. A Special Economic Zone is crucial as it offers tax and non-tax benefits to attract the necessary partnerships for this venture,” said Kilavuka.
Nominated Senator Peris Tobiko pointed out that many government officials avoid flying with Kenya Airways due to high ticket prices compared to competitors.
Kilavuka also called on the government to support the airline in receiving VAT refunds totalling Sh2.7 billion as of August 2024 and urged assistance in collecting Sh840 million owed by various State agencies as of September 2024.
The CEO also sought help in repatriating Sh1.4 billion stuck in various African countries, including Nigeria, Malawi, Ethiopia, and Burundi, and stressed the importance of enforcing Air Service Agreements to ensure reciprocity for Kenyan carriers.
An exchange between Kilavuka and Nandi Senator Samson Cherargei ensued, with the senator accusing Kenya Airways of misleading the public about its financial status.
Kilavuka denied the claims, stating that while the airline has made profits, it still faces significant liabilities.
“It is reckless for Senator Cherargei to claim that we mislead the public. We have made some profits. I request him to withdraw his statement to avoid damaging client confidence,” said Kilavuka.
Cherargei also requested details on Kenya Airways’ fleet, which Kilavuka confirmed consists of 43 aircraft—25 leased and 18 either owned or under finance lease agreements.
The government has provided shareholder loans amounting to Sh25 billion since March 2020 to support the airline.
Kilavuka asked the Kenya Airports Authority (KAA) to prioritise Kenya Airways at JKIA by dedicating Terminal 1A to the national carrier to boost its competitive advantage.
“Ethiopian Airlines has exclusive use of Terminal 2 at Bole International Airport in Addis Ababa, while other major airlines like Air France, Emirates, and Delta Airlines also have dedicated terminals at their respective hubs,” he noted.
He also called on KAA to install a bird radar system, citing Sh9.7 billion in costs incurred by the airline due to bird strikes, and to upgrade screening machines at various terminals.
Kilavuka urged all Kenyans to support Kenya Airways, noting that the airline directly employs 4,500 people and indirectly supports thousands more, while connecting Africa to 40 destinations worldwide.
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