Airlines lead scramble for Zimbabwe business boom

Three new airlines are being set up to commence operations in Harare while other international carriers are lining up to tap into the growing domestic and regional travel market in Zimbabwe.

Meanwhile, businessmen from the rest of Africa are trooping to Harare to assess market conditions amid increasing hopes that Zimbabwe’s political problems are finally fading away.

Airlines are usually the first commercial operations to come in as soon as the fortunes in an economy start to turn up. Analysts say transport, mining, tourist operations and telecommunications are expected to be the first sectors to turn round in Zimbabwe.

Until now, Zimbabwe has had one airline, State-owned Air Zimbabwe. But last week, the directors of a new airline, Vicfalls Airways, announced plans to commence operations before the year end. Vicfalls had been registered two years ago but delayed the launch due to unfavourable political and economic conditions.

Secured planes

Mr Masiwa Table, a director of Vicfalls Airways, said the airline had secured planes, including a B767-300ER aircraft, and was scheduled to start operating in November. Apart from domestic routes, the airline aims to fly to Malawi, Mozambique, South Africa and Zambia.

“This is an opportune time for us to start trading. The World Cup (in South Africa) is around the corner and the global financial crisis seems to be abating, making market entry less difficult,” he said.

This is the third private airline to be set up in the country since the beginning of the year. Earlier, a group of local investors had announced they were setting up a low-cost airline to compete with Air Zimbabwe. The airline, Fly Kumba, is scheduled to begin operations this month, and will ply both domestic and regional routes, officials said.

Fly Kumba’s Managing Director Lloyd Muchaka said in a statement issued in Harare the airline had been modelled along the lines of low-cost carriers in Europe and was confident of securing a viable market.

“We intend to become Zimbabwe’s preferred low-cost airline, delivering the cheapest air fares with the highest consumer value and offering world-class service to price sensitive consumers,” he said.

The main route planned by the airline is Harare-Johannesburg, tapping into the more than three million Zimbabweans estimated to be living and working in South Africa.

A visa-free regime between the two countries, introduced two months ago, has also increased cross-border travel. In July this year, a London Stock Exchange-listed firm, LonZim, announced it had structured a deal that would see Fly540 Africa airline commence operations in Zimbabwe this month.

The company recently concluded an agreement with Fly540 Africa (BVI), a wholly owned subsidiary of Lonrho Plc and LonZim Air (BVI), a wholly owned subsidiary of LonZim Plc to have the airline commence flights in Harare.

LonZim’s executive chairman David Lenigas said: “ Not only does it make sound commercial logic, but it is an important step forward for Zimbabwe and helps stimulate economic recovery. Good transport networks are essential for the growth of Africa.”

Fly 540 Airlines has already been operating as a low-cost, no-frills carrier in East Africa, with a base in Nairobi. It operates flights in Kenya (Nairobi to Malindi, Mombasa, Lamu and Kisumu), as well as in Uganda, DR Congo (Goma), and Tanzania.

To run as Fly540 Zimbabwe, the new airline plans to operate its ‘low cost’ service from Harare International Airport and is scheduled to open flights to Bulawayo and Victoria Falls on a domestic basis and Lubumbashi, Lilongwe, Lusaka, and Beira on an international basis.

LonZim said Fly540 Zimbabwe had by July this year obtained the necessary Air Services Licence and, following completion of the arrangements with Lonrho’s Fly540, it would be possible for Fly540 Zimbabwe to finalise the necessary permissions to operate.

Air Botswana has already increased its weekly flights from Gaborone to Harare from two to three.

Business contact between Botswana and Zimbabwe has been booming since the beginning of the year, when a coalition government came into power. Botswana business leaders have been visiting Zimbabwe in droves in recent months scouting for investment opportunities, particularly in tourism.

Increasing frequencies

And addressing journalists in Nairobi soon after hosting this year’s annual general meeting on Friday August 25, Kenya Airways Chief Executive Officer Titus Naikuni said the airline was talking to Zimbabwe and Zambia with a view to increase frequencies. “We are talking to Zambia and Zimbabwe where we need to increase frequencies,” he said.

Last month, Kenol-Kobil Ltd, a Kenya-based oil marketing firm operating in eastern Africa, purchase of Shell and BP joint operations in Zimbabwe. Kenol-Kobil is buying more than 75 petrol stations spread throughout Zimbabwe jointly with Engen Petroleum Ltd, one of South Africa’s leading refined petroleum products marketers.

Announcing the deal, the group Managing Director and Chairman of Kenol-Kobil, Mr Jacob Segman, said the entry into Zimbabwe is a steeping stone as the company seeks to venture into other countries in that region.

“While Zimbabwe’s economy has declined sharply over the decade, it still boasts good infrastructure, and we believe that this will form the basis of renewed economic growth under the new Government of National Unity”, Segman said.