JETLINK’S FUTURE IN BALANCE AFTER FASTJET DUMPS JV IDEA
(Posted 11th June 2013)
Talks between Fastjet and Kenya’s Jetlink, initiated at the height of the legal troubles by FastJet with partners Fly 540, were according to a source in Nairobi ended without an agreement being reached, following the end of the legal battle between 540 and FastJet a few weeks ago.
Jetlink had to halt operations when they ran out of cash, over 2.5 million US Dollars are being held captive by South Sudan’s Central Bank, unwilling or unable to permit the remittance of ticket sales accumulated over a period of time. Jetlink, which operated up to three daily flights between Nairobi and Juba, and arguably one of the most successful airlines on the route, failed to secure Kenya government intervention to compel the South Sudanese to pay up, a situation repeated many times over for companies from Kenya and Uganda, which supplied goods and services to businesses in South Sudan only to find out that, when the oil exports via Port Sudan ceased, that the country had run out of foreign exchange.
While there was hope for a while, when exports had resumed a few weeks ago, that such issues could at last be amicably settled, these hopes appear to have been dashed over the weekend when regime strong man Bashir announced in Khartoum that he had once again halted all South Sudan oil exports over increased and renewed tensions. The business communities in Kenya and Uganda have appealed to their respective governments to demand full payment of outstanding and unsettled bills before advancing South Sudan’s bid to become a member of the East African Community, with one regular, albeit very outspoken contributor from Kampala having this to say: ‘As long as our companies are not paid, why should we provide political advantages to them. They must learn to behave in a civil way and part of that is to pay bills. Many companies are financially ailing after being told that huge consignments delivered to Juba would in the end not be paid. We demand a quid pro quo, they want to join the EAC, let them settle their bills first. I think that case of Jetlink is maybe the worst but it is a tip of the iceberg really. Our traders delivered beers, soft drinks, food and spare parts, paint, cement, buildings steel and more and in turn our traders in Juba are often mistreated or even killed. You tell the world that this is not acceptable. They may be in difficult circumstances but they are not helping themselves by agonizing the business communities of countries friendly to them’.
Jetlink indeed is the most publicized of the known cases of payment disputes with South Sudan, and the latest developments between Juba and Khartoum would indicate that a part or full remittance might yet be delayed further.
The end of cooperation talks with FastJet, and pending court cases by suppliers of Jetlink in Nairobi, have also dashed any immediate hopes that the company could be revived and flights resumed. Watch this space therefore to find out in future editions if Jetlink will ever take to the skies again or remain grounded, shackled by debts, courtesy of the Central Bank of South Sudan.
