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Q&A with Kenya Airways CEO Allan Kilavuka

Kenya Airways chief executive officer Allan Kilavuka fields questions from the public via Sunday Nation.

When the government describes KQ as a “strategic national asset”, what does this mean given that the airline is not wholly-owned by the public? Githuku Mungai, Nairobi

Strategic national assets are those that the countries consider critical to social-economic development. For example, in the US, digital infrastructure was categorised as a “strategic national asset” by the Obama administration even though it is owned by the private sector.

Airlines make a significant contribution to a country’s economic development. Dubai for instance owes a lot of its vibrant growth to the connectivity offered by their airline. KQ did not start being strategic for Kenya when it went into financial problems.

Kenya’s main foreign exchange earners are diaspora remittances, horticultural export, and tourism. Horticultural produce is exported by air, mainly to Europe, and meat to the Middle East. In addition, Nairobi houses Africa headquarters of many regional organisations and is the home of key UN agencies. Kenya Airways accounts for about 60 percent of the JKIA operations. This network enables the flow of tourism and trade in Kenya and Africa, bringing in much-needed foreign exchange.

Overall, the International Air Transport Association estimates that the direct and indirect impact of KQ on Kenya’s GDP is about three percent or approximately $2.6 billion per year. Its direct contribution to Kenya’s tax revenues in 2019 alone was over Sh9 billion.

 Why should KQ which makes huge losses continue to get State bailouts? Also, why are KQ ticket prices costlier than other airlines? Carey Yiembe, Mombasa

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