China Southern Starts Kenyan Flights As Tourism Grows; Nairobi Reviewing Air France-KLM Stake In Airline After Loss
China Southern Airlines introduced flights to Kenya to tap an expected 15% increase in travellers to the East African nation, Chairman Si Xianmin said.
The Guangzhou, China-based carrier carrier is planning 20 flights per week in a code share with Kenya Airways, Si said in an interview Wednesday in the capital, Nairobi. The number of air travelers between China and Kenya was about 120,000 last year, he said.
“We expect growth in the number of travellers for this route to be around 15% annually starting in 2015,” Si said. “Traffic has been very strong, supporting the need for an air corridor between the two countries. We are very optimistic about the potential of this route.”
China is among markets that Kenya is targeting to boost tourism, the biggest generator of foreign-exchange after tea exports.
The industry has suffered after a series of attacks by Islamist militants scared off visitors. The number of tourists to the country dropped 19% in the first half of this year to 347,398.
China Southern’s Nairobi-Guangzhou route is its second in Africa after Mauritius. The flights will boost the number of Chinese tourists to Kenya and the entire East African region, Si said.
“We could further promote what Kenya and the rest of Africa has to offer in tourism to Chinese travellers,” he said. “No Chinese airliner has served this market yet.”
China Airlines’ inaugural flight landed at Jomo Kenyatta International Airport in Nairobi on Wednesday. The carrier is considering other routes on the continent, including South Africa, Si said.
Meanwhile, Kenya’s government is reviewing its partnership with Air France-KLM in Kenya Airways, which needs about $600 million to recover after posting a record loss, Treasury Secretary Henry Rotich said.
The state may increase its shareholding in the airline if a capital injection “dilutes shares” of other principal shareholders, Rotich said in an interview Wednesday on Citizen TV, a Nairobi-based broadcaster.
Any additional funding would include a mixture of debt and equity and would depend on a turnaround strategy expected from the airline’s management soon, he said.
It’s “difficult for Kenya Airways to borrow long-term” because of the loss it made, Rotich said.
Kenya Airways, sub-Saharan Africa’s third-largest carrier, said July 30 it will borrow $200 million and sell assets after posting a dull-year loss of 25.7 billion shillings ($255 million), the biggest in the nation’s corporate history. The shares have dropped 19% since the announcement to the lowest level in almost 13 years.
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