28.04.2005 Business & Finance

Ethiopian Airlines To "Rescue" GIA?

By Graphic
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Ethiopian Airlines To Partner Ghana International Airline ETHIOPIAN Airlines will partner Ghana International Airlines Limited (GIAL) when the new airline begins its operations in June, this year.

Sources close to GIAL said the arrangement was to enable the GIAL to “aggressively pursue strategic marketing alliances and code sharing opportunities both within Africa and on global basis”.

According to the source, this arrangement was seen as being more convenient since GIAL was a new entity and, therefore, would need not less than 18 months to meet an aviation requirement to fly long hauls demanded by the United States Aviation Authority, before some specific aircraft, such as the Boeing 767 could fly to the US.

The source said the Ethiopian Airlines had, therefore, been brought in to take care of the long hauls while GIAL plied the sub-regional routes.

According to the source, GIAL was also making arrangements with other airlines in Europe and America to join in the code-sharing programme.

The sources said the Ethiopian Airline-GIAL deal was part of the proposal submitted by the consortium of business entities that formed the GIA-USA as far back as March 31, 2004, before it won the bid to partner the government in the re-structuring of Ghana Airways, saying that 'code sharing' was nothing new in the airline business.

In a proposal made available to the Graphic, the consortium had stated that “a strategic East and South regional partnership would be cemented as quickly as possible as this would further enhance the viability of Kotoka International Airport as the true gateway to Africa from the US markets. Ethiopian Airlines, as an example, had already expressed keen interest to partner with the successful bidder for Ghana Airways,” adding that it expected other interested parties to express interest after the process had been completed.

“Such arrangement exists among British Airways and American Airways, KLM, Kenya Airways, North West Airline and Continental Airline in the USA and many more”, the source said, adding that “it is all a question of ensuring maximum passenger volume”.

“So far, Ghana Airways exists as a different entity from GIAL” and according to officials of GIAL, it was not going to receive any assets or employees from Ghana Airways.

The sources, however, explained that GIAL was going to ply Ghana's routes which were formerly used by Ghana Airways, since that was the country's bilateral right.

The GIA-USA has so far contributed $2.1 million as its 30 per cent shares in the airline, while the government of Ghana, which has 70 per cent stake, has contributed $4.9 million for business to commence.

GIAL came into being after a consortium known as Ghana International Airline-USA was given the nod last year to partner the government to form the GIAL, when the operations of the distressed Ghana Airways were terminated after the airline had run into debts of many millions of dollars as a result of decades of unproductive services.

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