- Ethiopian wants CEO, CFO and maintenance jobs as Namibia seeks shareholding
- Airline also wants Namibia Air to drop Windhoek-Johannesburg, Windhoek-Cape Town and Windhoek-Luanda routes from the initial network
TIRI MASAWI
Ethiopian Airlines is seeking management control of Namibia’s planned national airline, including the appointment of the chief executive officer, chief financial officer and head of maintenance, while Namibia is pushing for an equity partnership with the Ethiopian carrier.
The proposed arrangement, revealed in an internal Ministry of Works and Transport briefing to Minister Veikko Nekundi, emerged from meetings between the two sides in Addis Ababa on 21 and 22 August.
The Namibian delegation was led by Executive Director Jonas Sheelongo, who is also chairman of the Technical Committee for the National Airline.
The delegation met Ethiopian Airlines chief executive officer Mesfin Tasew Bekele and senior management to discuss cooperation in establishing Namibia Air.
Ethiopian has agreed to explore a management contract and provide technical support, but has stopped short of committing to take a stake in Namibia Air.
The airline told the Namibian delegation that any future equity participation would depend on the business plan being commercially feasible and would require management control, including the chief executive officer, chief financial officer and maintenance positions.
“They indicated that they have three partnerships on the continent and require more time for an informed decision on investing as an equity partner in Namibia Air,” Sheelongo said in the memo.
The position places Ethiopian’s proposed role at the centre of the emerging structure of Namibia Air, with the carrier potentially having significant influence over the airline’s management even before deciding whether to invest.
Sheelongo couldn’t comment at the time of publishing this story.
FIVE YEARS OF LOSSES
Ethiopian has also challenged key elements of Namibia’s proposed operating model.
According to the internal memo, Ethiopian reviewed Namibia’s market study and tabled a counter-proposal based on ATR 72-600 aircraft, training and maintenance, repair and overhaul support.
Its financial projections, however, indicate that the airline could record losses for five years under the proposed model.
Ethiopian proposed three ATR 72-600 aircraft for the first three years of operations, followed later by a Boeing 767.
Namibia, meanwhile, proposed Embraer 145/175 regional jets, based on the size of the market.
The two sides agreed to assess the use of Embraer aircraft for domestic operations. Ethiopian also advised that Namibia start with three aircraft and one daily flight to Johannesburg, with flights increased later to limit risks.
It recommended leasing aircraft rather than purchasing them at the start-up stage.
The carrier further offered to assist Namibia with aircraft sourcing through its relationships with aircraft lessors and owners.
KEY ROUTES CHALLENGED
One of the major differences between the two sides concerns the proposed route network.
Ethiopian proposed removing Windhoek-Johannesburg, Windhoek-Cape Town and Windhoek-Luanda from the initial network.
Namibia, however, insisted that the three routes are important to the success of its business plan.
“Namibia reiterated the importance of the Windhoek – Johannesburg, Windhoek – Cape Town and Windhoek Luanda routes for the success of the business plan,” Sheelongo said.
The two sides also discussed training, MRO, manuals, access to Ethiopian finance and IT systems and preferential aircraft leasing rates.
Ethiopian indicated that it could immediately assign personnel to assist with refining Namibia Air’s business plan and setting up the airline.
It also committed to providing technical support even if a management agreement is not ultimately concluded.
EQUITY STILL ON THE TABLE
While Ethiopian is not ready to commit to equity, Namibia has made it clear that it wants more than technical assistance.
The memo states that Namibia proposed equity or another form of partnership and indicated that it was open to joint management discussions.
The two parties agreed to proceed with technical cooperation and to explore a management contract while Ethiopian considers whether to participate as an equity partner.
Ethiopian is expected to share a draft management contract, while work will begin on certification documentation required by the Namibia Civil Aviation Authority.
The two sides also agreed to jointly assess aircraft and maintenance requirements.
The ministry’s recommendation is to proceed with the technical cooperation and management-contract route while Ethiopian considers equity participation.
It also recommends prioritising certification support and refinement of the business plan with Ethiopian’s technical team, with a target of commencing operations in December 2026.
IPC QUESTIONS FOREIGN CONTROL
The proposed arrangement has already drawn criticism from the opposition Independent Patriots for Change (IPC), which questioned Ethiopian’s demand for control of key executive positions.
IPC shadow minister for Works and Transport Nelson Kalangula said regional integration under the African Union’s Agenda 2063 and the Single African Air Transport Market is commendable, but argued that the proposed arrangement raises concerns about the role of Namibian aviation professionals.
“Namibia possesses a pool of highly skilled, internationally certified aviation professionals, many of whom gained invaluable experience operating within the former Air Namibia, private aviation sectors, and regional carriers,” Kalangula said.
He said Namibia has qualified pilots, finance experts, operations managers and aircraft engineers capable of occupying senior positions at a national airline.
Kalangula questioned how handing key executive positions to a foreign carrier would contribute to building Namibian aviation capacity.
“To sign over these top executive posts to a foreign carrier signals a complete lack of faith in our own citizens,” he said.
He also questioned the basis for the changes proposed by Ethiopian after reviewing Namibia’s market study.
Feasibility study questioned
Kalangula said the internal memo shows that Ethiopian reviewed Namibia’s market study and then proposed significant changes to the airline’s planned fleet and route network.
He described this as raising questions about the relevance of Namibia’s own feasibility work.
“The internal memo reveals that Ethiopian Airlines reviewed Namibia’s market (feasibility) study, which Parliament has been asking for but to no avail, and promptly tabled a counter-proposal that completely undermines Namibia’s original strategy,” he said.
The government’s internal report does not indicate that a final management or equity agreement has been signed.
For now, Ethiopian has agreed to provide technical assistance and explore a management contract, while Namibia continues to seek a strategic partnership and Ethiopian considers whether to take an equity stake in Namibia Air.
COMMENTS