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Thursday, 6 June 2013

Proflight Zambia Soars

Proflight Zambia appears to be on the march. It recently announced that next month it will go "regional" with a new three-times-a-week service between Lusaka and Lilongwe. The new route, scheduled to be launched June 4, is the first international destination for the airline, which already flies to nine domestic points in Zambia, including Lusaka, Livingstone, Ndola and Mfuwe.

The airline appears to have grown from a solid base and is now looking to expand. It says it has "adopted a strategy of steady, careful growth and [is] now ready to take the next leap that will put Proflight, and Zambia, firmly on the regional aviation map".

It recently acquired a B737-200 with 105-seat capacity. The acquisition will almost double the carrier’s seating capacity. The aircraft will operate on Proflight’s routes from Lusaka to Livingstone and Ndola and has enabled the airline to reduce its "earlybird" fares.

The other benefit is time savings for passengers. The B737-200 can fly at speeds of up to 780kph, compared with the current maximum speed of 546kph of the Jetstream 41 aircraft, reducing flight times significantly. Its cargo capacity will also enable Proflight to offer increased baggage allowances on routes operated with the 737.

All this raises the obvious question.  Why is Government still pushing for a Government funded national carrier? Earlier this month we learnt GRZ is allegedly in talks with three airlines about taking an equity stake in a new national carrier called Air Zambia. It expects it to make its debut flight by the end of the year.Transport PS Muyenga Atanga says, “We are 60 percent advanced in all our preparations. We are quite confident that before the end of the year we should have a national airline.”

The Government is bent on start a national carrier as part of its efforts "to boost tourism and restore national pride". Zambia Airways, the most recent government-owned airline, went bankrupt in 1994. Which is clearly nonsense because Zambia already has various international airlines operating including British Airways, KLM, Ethiopian Airlines and others operating.

The GRZ plan is an irresponsible use of tax payers' money when Government is allegedly telling our poorest people to should be burden of high fuel and food prices. The arguement for removing fuel subsidies was that it was largely benefitng the rich. Surely that argument also holds for an airline? Who will use it? Is it not just the very rich? The argument that this will lead to "trickle down" benefits to everyone is equally misguided, precisely because we already have airlines in Zambia. 

Let Proflight Zambia and others continue to grow on their own. If they have good business models they will borrow from the banks. I don't think the country is starved of credit for these businesses. Also I am against GRZ operating in industries it regulates. It results in "regulatory capture". It also has other competitive advantages. The airline with GRZ funding will always better access to policy decisions concerning the industry and may borrow more cheaply.

Why is it that as a people we never seem to think through such things? We just act blindly and waste money at every opportunity! What sort of country are we? The unexamined life is not worth living!

Copyright © Zambian Economist 2013

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