Ghana Airways Owes $160,000,000 THE CONTROVERSY generated over the proposed partnership between the commatosed Ghana Airways and Ghana International Airlines, escalated last Sunday, when some workers of the defunct company hit the May Day parade grounds with coffins and condoms, and nosily protested against the choice of a partner for the national carrier. They also demanded payment of their salary arrears, and accused government of lack of transparency in the deal between Ghana Airways (GA) and Ghana International Airlines (GIA) which was selected, out of four interested consortiums to partner Ghana Airways.
The distressed airline according to available documents owes Alitalia about $25 million, which has grounded three of its aircrafts in Rome.
The company owes KBC Bank in London about $13 million, CDH $ 11 million, and also the Civil Aviation Authority, Shippers Council, Ghana Commercial Bank, and Airways Catering huge sums of money.
It is worthy to note that as at January 2001, the debt portfolio of GA, as presented by the board to the Ministry of Road and Transport, was $133 million, and at the time of closure, the debt stood at $160 million, on February 12, 2005. Earlier reports had put the GA's debt at $190million.
A letter dated January 9, 2004, and signed by then Chairman of Board of Directors, Dr. Eric Dwemoh, stated that following a meeting with the President on October 23, 2003, the board held discussions with various potential partners in the airline industry”.
The letter stated the board received high-level written proposals from seven of such potential partners.
“Through a preliminary review of the proposals received, the Board short-listed four of them for a more detailed evaluation. We sought, and obtained assistance of Price Waterhouse Coopers in the evaluation of the four short-listed proposals.”
Dwemoh named the four short-listed proposals as follows:
1. Proposal by Fidelity Group, Kenya Airways and KLM 2. Proposal by Corporate Trade Solutions Incorporated 3. Proposal by Ghana Air Partners by IC Securities 4. Proposal by Ghana International Airlines The board of Directors consequently set four (4) criteria against which to select its final choice.
It gave 40 per cent as its benchmark for operational and managerial capacity, including the ability to bring operational know-how and systems which will enhance marketing, financial control and engineering systems, as well as a platform for shared services as efficient computerised reservations, ticketing and revenue management systems.
Similarly, it expected thirty percent in financial strength and standing, which will allow the partner to inject adequate working capital, and to assist with restructuring of Ghana Airways' existing debts.