State to take Air Tanzania management away from SAA
The Tanzania government is seeking to remove the management of Air Tanzania from South African Airways (SAA), which bought a 75 per cent interest in the national carrier for $20 million in December 2004.
The government has formed a committee to look into how the Air Tanzania Corporation Ltd can be delinked from SAA, which it accuses of failure to meet a large part of the management agreement.
SAA in turn accuses the government of not "being serious" in releasing an estimated $30 million that is needed to implement the airline's business strategy to reverse continued losses.
Air Tanzania recorded a pre-tax loss of almost $7.3 million in its first year of operations following privatisation and part ownership by South African Airways.
The loss was attributed to a failure to expand the network as quickly and extensively as originally planned.
Air Tanzania was expected to launch services from Dar es Salaam to Dubai, Mumbai, Muscat and London but fleet limitations put paid to the plan.
Delays in the development of Dar es Salaam as an East African hub for the South African Airways alliance compounded the problem. A year ago, Air Tanzania suspended one of its few regional services – Dar es Salaam to Nairobi – in the face of intense competition from Kenya Airways on the route.