Precision Air left hanging as TZ government turns down request for help


(Posted 11th October 2013)

The Tanzanian government has again played their Kenya card when explaining why, after initially agreeing to support a financial bailout package for struggling Precision Air, they ultimately decided not to come to the aid of Tanzania’s largest private airline, quoted on the Dar es Salaam stock exchange.

Comments made by government officials point clearly into the direction that they were unhappy with Kenya Airways being a major shareholder in Precision Air, and used this Kenya link to bring the deal down.

Aviation observers, many of whom have in the past severely criticized the Tanzanian government for repeatedly bailing out moribund national airline Air Tanzania with billions of shillings of tax payers money, were equally swift to condemn the refusal to aid Precision Air with one regular source writing: ‘It shows the full bias of the Tanzanian government establishment towards anything to do with Kenya. It also shows that they are happy to violate the principle of equality when they keep pouring money into Air Tanzania which has nothing whatsoever to show for those subsidies while letting Precision Air hang, just because KQ is a shareholder there. For me it confirms what has been seen many times before, when they [Precision
Air] opened their hangar the taxi way had not been completed, the obstacles to have their IPO take place as scheduled and even letting them suffer at the hands of the Congo civil aviation when they could not get permits to land in Lubumbashi a few months ago and our government did nothing to intervene. For Air Tanzania they would have sent a special envoy even but for a private company? In fact rumour has it that they hope to see Precision go bust so that their scheme to revive Air Tanzania can perhaps take off and there will be a lot more money to eat again. It sends a bad, a very bad message to investors’.

The decision is thought to set on a collision course the promoters and marketers in the tourism industry with the government’s decision to lay the problem on the door step of Kenya Airways, as, should Precision Air not be able to continue operate their scheduled flights, tourism arrivals would be seriously affected as would travel to secondary airports across the entire country where presently only Precision Air offers air services. Watch this space for breaking and regular news from the Eastern African aviation scene.

3 Responses

  1. What a huge let down by the Tanzanian government.
    In this era of public/private partnership, they have decided to stick their heads in the sand, and let an airline like Precision Air, that has a huge potential get on the danger list.
    Air Tanzania is a white elephant, that should be allowed to quietly proceed to the elephants graveyard.

  2. If a private company has shown repeatedly that it cannot manage its finances, is such a company worthy of a government investment of tax payers’ hard earned money? Shouldn’t a privately owned airline that is in need of financial rescue rather engage with its own shareholders first? If these shareholders are so confident of their organisation’s success, then surely they should be the first to invest their own capital and finances?

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