The pressure grows on the UCAA as the first local airline faces financial ruin


(Posted 14th July 2014)

News broke this morning that the smokescreen action by Uganda’s Civil Aviation Authority, which, faced with failing an ICAO audit then turned matters on their head and suspended AOC’s for airlines operating international flights like Air Uganda and Uganda Air Cargo to save their own skins, has now claimed its first financial victim.

A number of Uganda’s smaller air operators, flying within the country but also regularly to and within neighbouring countries, were apparently equally affected when their operations to for instance South Sudan and Eastern Congo were halted.

Asante Aviation, which relied heavily on contracts and cash flow from work in South Sudan, had according to information received been unable to conduct such flights, and with the cash flow reducing to a trickle the endgame was accelerating, leading to their two aircraft being put up for sale by the financiers.

This being bad as it is, the Uganda Civil Aviation Authority’s action is now also allegedly putting lives in danger as Mission Aviation Fellowship, in short MAF, which flew a great deal of humanitarian missions in South Sudan and elsewhere in the region, including flying missionaries to places where they were needed or take them out of locations when bullets started to fly, also can no longer conduct flights in South Sudan, forcing the missionaries to travel over at times extremely dangerous roads to reach their destinations or escape to safety with their lives and possessions intact.

Other airlines based at Kajjansi too are affected, with the Aero Club no longer able to fly to Eastern Congo and Ndege Juu losing a lucrative contract from the EUTM which would have required flights into and out of Mogadishu. Tim Cooper of Ndege Juu said ‘Because we no longer have an AOC that allows us to operate internationally we have had to disqualify ourselves from a number of contract negotiations whose value runs into the millions of dollars. I know that other smaller operators are in exactly the same position. It is not just the current financial loss that we are suffering, but the reputational damage that has been done is beyond measure. Rival operators from Kenya are now able to pick up the contracts that we have been forced to relinquish’.

For some aviation pundits it is now just a matter of time when the dominos will start to fall and more airlines are pushed to the wall.

Overall we estimate that we as an industry are running into multi-million US Dollar losses in terms of revenues. The cash flow is drying up after nearly a month of being unable to do international flights but our overheads remain, rent, utilities, wages, maintenance bills, insurance payments. There is no end in sight as yet when the UCAA will finally return AOC’s allowing for international operations’ said one source in a conversation this morning. Another source confirmed that ‘… in a worst case scenario that can take a few more weeks because they work like 9 – 5 from Monday to Friday. It seems they have no sense of urgency even though this can destroy aviation as we know it in Uganda’.

There has also been hushed talk of airlines planning to take the UCAA to court with massive claims as a result of the developments over the past few weeks, in part focused on the authority claiming to act in accordance with the Air Operator Certification Regulations of 2014, which at least at the time the letters were written was not backed up by a Statutory Instrument and in part for other reasons which cannot be revealed here at this time for reasons of confidentiality and to avoid revealing legal strategy. It could not be established if those regulations have now been made legal or if the gazette notice is still outstanding. Some aviation experts also already pointed out a number of deficiencies and omissions in the new regulations for 2014, which according to another source exposed the rot in the CAA and in the words of yet another aviator shows ‘incompetence, ignorance and arrogance’ on the part of regulatory staff.

It is clear that any dialogue between the operators and the regulators has all but broken down and that the quintessential element of trust has been trampled into the dust, raising the question for how long the UCAA’s key staff can survive under this sad state of affairs when they are now perceived no longer as partners but as dictators and terminators. The UCAA in this case has ignored that part of their mandate which requires them to nurture and develop aviation in Uganda for reasons best known to the individuals behind these catastrophic decisions while hiding behind the notion that it was in the interest of safer air operations. The bitter truth is that it was in their very own interest to avoid being cited and their institutional failures becoming international knowledge, but the attempt to hide behind their smokescreen has clearly failed as the matter has gone into the public domain after all and fellow regulators in the region are shaking their heads in utter disbelief.

From political sources it is also now understood that there may well be a major clean out at the authority once this sordid saga is finally over as in the words of one well-placed source ‘this has brought Uganda into disrepute and no matter what they now say, they handled this very badly. Such actions have consequences, it might take a bit but be sure that some heads will roll’.

There is also no confirmation that the board of directors has called for an emergency board meeting to have senior management explain themselves or has officially engaged with affected airlines, which if true will also leave their reputation in tatters.

For breaking and regular news about aviation developments in Uganda and the wider Eastern African region, look no further but watch this space.

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