National airline plan hits snag

Ghana’s efforts to establish a national airline has hit a snag as officials struggle to complete the necessary processes to start operations before the close of the year.

Efforts to have the national carrier in the skies since 2017 have been fruitless although officials have already registered a joint venture — Ghana Airlines — acquired an office block, set up a board of directors for the airline and appointed an accountable manager.

Information the Daily Graphic obtained from the Ministry of Transport indicates that the recruitment and training of critical office staff is ongoing and so are the designing of a corporate logo and branding, and the development of management and non-technical operating manuals.

The Daily Graphic has established through a year-long investigation that a selected strategic partner, Ashanti Airlines Limited (AAL), has no aircraft, no licence, and is without the financial strength for the business.

Ashanti Airlines

The Daily Graphic’s sources at the Office of the Registrar of Companies indicated that the Ashanti Airlines Limited was incorporated on December 13, 2017. It won the bid ahead of Ethiopian Airlines and EgyptAir that had been major players in the aviation sector in Africa and the rest of the world for several decades as well as JNH Group, a company with a group net worth of over $1.5 billion but was yet to acquire an Air Carrier Licence (ACL) and Air Operator's Certificate (AOC).

The current government's plan to establish a home-based carrier has been mentioned in five budget statements over the last seven years. With the latest update in 2023 announcing the airline's name as Ghana Airlines, and a strategic partnership with Ashanti Airlines confirmed, the Transport Minister promised operations would begin in June-July last year, but the airline is yet to launch, almost six months to the exit of the current administration.

AAL requires an aircraft to complete the five-step regulatory process and acquire the air operators’ certificate (AOC) from the Ghana Civil Aviation Authority (GCAA) in order to start operations.

However, the company has been unable to secure an aircraft to start operations within schedule. The Ministry of Transport also told the Daily Graphic that aircraft had become scarce for startup firms due to the post-COVID-19 boom in the aviation industry.

Govt’s position

The Chief Director of the Ministry of Transport (MoT), Mabel Sagoe, in response to Daily Graphic’s queries pursuant to the Right to Information (RTI) Act, 2019 (Act 989), stated that the preparation and launching of the airline was progressing steadily as Ashanti Airlines worked towards acquiring the air operators’ certificate to start operations by the third quarter of this year.

“The government set out to partner the private sector for the establishment of a national carrier for the country. In this regard, the government has a partnership agreement with a strategic partner, Ashanti Airlines, as was stated in the 2023 Budget and Economic Statement,” she said.

So far, Mrs Sagoe said achieved milestones included completion of eligibility assessment of application for the issuance of air operator’s certificate; the renewal of the air carrier licence and completion of the registration of a joint venture; while evaluation, approval, authorisation and acceptance of operational and maintenance documentations and arrangement were 80 per cent complete. 

Reason for delays

The Chief Director explained that the delay in the launch of the carrier was due to the non-availability of aircraft on the market for start-up companies due to the post-COVID-19 boom in the aviation industry.

However, she said, Ashanti Airlines had informed the ministry about a negotiation it was carrying out to lease aircraft to commence operations. Consequently, the business plan was being reviewed to reflect changes in the cost of operations, which Mrs Sagoe said had been occasioned by price variation due to the COVID-19 and scarcity of aircraft in the market.

“Ashanti Airlines and its partners will soon submit a revised business plan to the ministry. In consultation with Ashanti Airlines, the proposed national airline should be ready by the third quarter of 2024,” she added.

Lost confidence

A source within the National Airline Committee who prefers to remain anonymous because he is not authorised to speak, told the Daily Graphic that the committee had lost confidence in AAL to revive Ghana's national carrier dreams.

This is due to AAL’s inability to secure an airline operating certificate and acquire aircraft nearly two years after winning the bid, as well as its limited financial strength for the project.

As a result, the source said the committee had started initiating contacts with other airlines and firms that participated in the bidding process, inviting them to resubmit improved bids, signalling a potential new direction in the search for a suitable partner to restore Ghana's national airline.

National carrier significance

To help understand the significance of a national carrier, the Director of Institute of Statistical, Social and Economic Research, University of Ghana, Professor Peter Quartey, told the Daily Graphic that a national airline served as a vital component of a country's transportation infrastructure, providing convenient and reliable air travel services for citizens, tourists and business travellers.

He said in Ghana’s situation it would play a crucial role in revenue generation, promote tourism and trade, and enhance cultural exchange through the connecting cities and regions.

GCAA position

Although the GCAA remains tight-lipped on the issue, information gathered from multiple sources within the authority indicated that the AAL in its quest to acquire the air operators’ certificate was currently at phase four of the five-step certification process due to the absence of an aircraft and for that reason could not be described as an airline.

At the demonstration and inspection phase, the Ghana Civil Aviation Regulations (GCARs) require an operator to demonstrate its ability to comply with regulations and safe operating practices before beginning actual revenue operations.

These demonstrations include actual performance of activities and/or operations while being observed by the authority’s inspectors. They include on-site evaluations of aircraft and its maintenance equipment as well as support facilities.

During the demonstrations and inspections, the GCAA evaluates the effectiveness of the policies, methods, procedures and instructions as described in the operators’ manuals and other documents.

Emphasis is placed on the operator’s management effectiveness during this phase. Deficiencies will be brought to the attention of the operator and corrective actions must be taken before a certificate is issued.

After the document compliance and the demonstration and inspection phases have been completed satisfactorily, the application then moves to the final process of the certification phase.

The air operator’s licence is a five-step certification process from pre-application, formal application, document evaluation, demonstration and inspection and certification phase that takes a minimum of 90 days, but ideally lasts between six and 18 months for most airlines.

Context

Ghana has been without a national carrier to operate international flights since 2004, when Ghana Airways ceased operations. Its successor, the Ghana International Airlines, which started operations in 2005, also shut down in 2010, leaving a void in the country's aviation industry.

The government established Ghana Airways in July 1958, with startup capital of £400,000, and a stake of 60 per cent, while its partner, British Overseas Airways Corporation (BOAC), held the rest.

 Email: maclean.adu@graphic.com.gh