Chakwera keen to address Malawi Airlines crisis, sets meeting with Patridge

President Lazarus Chakwera  is keen to see Malawi Airlines financial situation that may lead to liquidation be duly resolved and has set a meeting with George Patridge, the chairperson of the  country’s flag carrier, to address the crisis, State House director of communication Sean Kampondeni has said.

Malawian Airlines cabin crew

Kampondeni said this Monday during the Weekly State House Briefing which was virtually held from Mtunthama State Lodge in Lilongwe as published reports indicated  Malawi Airlines could be liquidated should its two shareholders, the Malawian government (51%) and Ethiopian (ET, Addis Ababa ) (49%), fail to inject much-needed fresh capital.

“Following the President’s desire to address the emerging crisis regarding the Malawi Airlines, he will be  meeting the chairman of Malawi Airlines this coming Wednesday, the 14th of April, 2021,” said Kampondeni.

He dislocsed that President Chakwera has already met former  pilots of the now-defunt Air Malawi to understand how best government can  challenges gripping the country;s flag carrier.

The Nation newspaper cited company documents last week saying that the airline’s board of directors had declared it technically insolvent during a meeting on March 25.

According to the report, by February, the carrier had cumulative losses of MWK14.09 billion kwacha (USD17.86 million) against total debts of MWK13.83 billion (USD17.54 million).

“The directors have assessed the company and found it technically insolvent and not a going concern if shareholders do not inject equity into the company. The directors are of the opinion that the company cannot continue to trade in its current state without a rescue package, while there is still a significant gap between costs and revenue,” the resolutions said.

The board said that Malawi Airlines’ losses had started even before the pandemic, given intense regional competition from other southern African carriers as well as high operating costs. While COVID has worsened the situation, shareholder failure to assist the airline would be the final blow.

“In the absence of any injection of capital and with all the requested cost reduction relief measures not being approved, it is resolved that under the circumstances, where the shareholders of Malawi Airlines have not committed to the recapitalisation of the business or approved the requested relief measures and that the going concern is uncertain, the board of directors recommends an orderly winding up of the company and further recommends the appointment of a liquidator to discharge obligations and minimise further liabilities,” the resolutions said.

The board of directors will now pass the board recommendation to the two shareholders, who will then decide whether to proceed with the airline’s orderly liquidation.

Founded in 2013 as the successor to Air Malawi (QM, Blantyre ), Malawi Airlines was to have been developed into Ethiopian’s primary feeder carrier for the southern Africa region using Lilongwe as a regional hub. However, high operating costs, including import duties and aviation-specific duties, have thwarted these plans, resulting in the airline suffering little to no growth. Over the last six months, it has also had to cope with the impact of COVID-19, which has led to key markets like South Africa being closed to foreign passenger traffic.

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Nyama zawo
Nyama zawo
27 days ago

Just close this useless company and start a new, with new management and see the way out. These are DPP leftovers hence never think of revivals, It wont happen

News Guru
News Guru
27 days ago
Reply to  Nyama zawo

How can they start a new company when they don’t have any money to even bail out this one , aviation is a dieing business in general worse yet these guys partnered with Ethiopian airlines who are just eating our sub lease fees but do not want to contribute to bailing out the business

Moya
Moya
28 days ago

This was a bad business deal. Just liquidate it and set up a fresh one. Instead of pumping our Tax money into this bad Ethiopian airline deal let’s have our own 100% Malawi airline. Bring air malawi back but not with the old top management that led to it’s death

Jah
Jah
28 days ago

odala simungakonze izi

Paul
Paul
28 days ago

In addition to my earlier comment above, an average turbo-prop airliner would burn about 650 kgs fuel flying between Chileka and Kamuzu International airport, (much less for newer types). Such a figure is the same amount a Jet airliner burns from the parking apron to the beginning of the Runway prior to take-off. In such a scenario, it is easy to see a smaller turbo-prop airliner with average twenty passengers having a break-even passenger numbers of less than eight but with the benefit of near jet aircraft speeds since a jet airliner would require a longer cruise sector to have… Read more »

Piper
Piper
28 days ago

The airline was doomed from the start. It only caters for very few individuals who have the means to travel by air and not the majority of Malawians. And to make it worse, they have business class on board which basically means flying empty seats. It would be better to get smaller turboprops like the Dash 8 and fill them up every time. Even though slower than the current 737, they have relatively lower fuel and maintenance costs. Then introduce competitive fares on domestic routes that would make the masses prefer traveling by air than using Khwezi buses. Finally the… Read more »

Nyama zawo
Nyama zawo
27 days ago
Reply to  Piper

You have my support bro. Take this and forward it to Chakera

Declerk
Declerk
28 days ago

Partridge koma akazi

Simon Chikuse
Simon Chikuse
28 days ago

The Tobacco Barn Airport should be demolished and have a state of the art Airport,to attract major investment in the country, Bring back Air Malawi we can do it

weaklicks
weaklicks
28 days ago

meeting former pilots? these people just know how to fly planes and they know nothing about the business of airoplanes. We are cursed as Malawians because we dont have leadership. Even Patridge is now redudant in his brains. All companies under press except NBM are going under under his watch. Above all there seems to be too much on him as he chairs too many companies.

Kamchiputu
28 days ago

One would wonder indeed why this so out of 17 million people who some of them have literally no jobs yet suit-casing very high qualitifications.

Ndafera Nkhande
Ndafera Nkhande
28 days ago

Keen but not willing nada.

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