Details of a proposed turn-around plan for Air Zimbabwe have come to light. According to a report by local media, the airline’s administrator has urged government to put in place a foreign currency funding model which will protect the airline from the volatile local currency
“Air Zimbabwe is operating in an environment where it is earning most of its revenue in local currency (RTGS).
However, most of its costs are denominated in foreign currency. Cumulatively over the years, the airline owes foreign creditors a total of US$30 258 618 as at 4 October 2018. The national airline therefore, requires prioritisation in foreign currency allocation in order to meet monthly foreign currency requirements. It is therefore imperative that the national airline is allocated a stipulated percentage of foreign currency generated from the tourism, business and industry sectors. These are the primary beneficiaries of the airline operations.”
It is not clear if the government is still pursuing a funding proposal which was tabled in November 2018. However, some of the recommendations made by the administrators have since been actioned
Last year, the national airline received two Boeing 777-200Ers from Malaysia to strengthen its wide body fleet and this year put into service an Embraer ERJ-145 with another expected later this year.
The airline was placed under administration in October 2018 to help guide it out of mounting debt and to restructure the carrier around a more viable and sustainable model. Administrator Grant Thornton is expected to leave at the end of June 2021 with the Zimbabwean government assuming up to USD 379 Million in both local and foreign debt
