Africa’s largest airline, Ethiopian Airlines, enters into a partnership with Ghana’s government to launch a new Accra based airline. The Star Alliance member is due to send several Dash 8-400s aircraft to Accra later in 2019. The as yet unnamed airline will initially focus on domestic routes.
Ethiopian lost a Boeing 737 Max in a crash outside Addis Ababa in March 2019 but the Ghanaian Government remains confident in Ethiopian Airlines and is proceeding with the deal initially inked in 2018.
A new beginning in Ghana
Ghana has been without a national airline since the collapse of Ghana International Airways in 2010. With over 30 million residents, Ghana is Africa’s tenth biggest country. It has a stable democratic government, a burgeoning economy and abundant resources, making the country a bright spot on the African continent.
There has been significant new infrastructure at Ghana’s airports recently. This includes a new terminal at Accra’s Kotoka International Airport, a new terminal at Kumasi, and expansion and reconstruction at Tamale, Wa and Ho airport’s.
Aviation in Africa has long been curtailed by poor management, inefficient monopolies, high taxes and costly operating costs. The collapse of Ghana Airways in 2004 is an example. The Ghanaian government owned 60% of the airline that was crippled by rampant over-staffing and over USD$160 million of debt. Ghana International Airways was born out of the rubble.
The Ghanaian government now took a 70% stake in the airline and brought in Ralph Atkin, founder of Skywest Airlines, to run the carrier. Not even he couldn’t save the airline from debt and protracted legal disputes between its shareholders. Ghana International Airways ceased operating in March 2010.
But Ghana’s government says it has learned from past mistakes and the country is now ready for a new national carrier.
Ethiopian Airlines expands
Across the continent, Ethiopian Airlines has bucked the African aviation trend and been a sustained success story. The airline has been operating for over 70 years. In the financial year 2017/18 it made a USD$245 million profit flying 112 aircraft to five continents and 22 domestic destinations. It has been a reliable go to airline for locals and many westerners jetting about Africa and has built a strong and growing reputation.
There are no more majority shareholdings. In it’s deal with Ethiopian Airlines the Ghanaian government is retaining a 10% stake, Ethiopian is taking a 49% controlling stake and Ghanaian investors will have the remaining 31% stake.
Ghana is smart enough to allow Ethiopian Airlines to do what it does best – run an airline while the Ghanaian government concentrates on running the country.
