Cdedi wants AG action on Malawi Airlines
Centre for Democracy and Economic Development Initiatives (Cdedi) has asked Attorney General (AG) Thabo Chakaka-Nyirenda to commission a forensic audit on Malawi Airlines and make public details of how the company is benefitting Malawians.
Cdedi claims there are some ‘systematic anomalies’ in the operations of the airline which was established through a public-private partnership (PPP) agreement in 2014.
Under the agreement, Malawi Government has 49 percent stake in the airline while Ethiopian Airlines (ET) has 51 percent shares.
In its letter to the AG dated January 8 2024, Cdedi says as expected, dividends were supposed to be declared by Malawi Airlines and made public.
“Failure to declare dividends alone, begs the question as to how Malawians are benefiting from this arrangement,” reads the letter signed by executive director Sylvester Namiwa.
Cdedi says building on the remarkable progress recorded in the recovery of public funds that were invested in Salima Sugar Company Limited (SSCL), through the Greenbelt Authority (GBA), the same must be done to Malawi Airlines.
The civil rights group has since implored the AG to help Malawians exercise their right to know how much Ethiopian Airlines brought on the table as their equity contribution and, also, thus far, how much profits have been declared.
Further, Cdedi wants an explanation, with evidence, what Malawi has benefited from the joint venture, apart from sheer prestige of having a “purported own airline, when in reality it is not”.
“Cdedi’s independent investigations show that Ethiopian Airlines deliberately failed to register the airline code for Malawi; instead it opted to use ET as the boarding code for Malawi Airlines.
“This systematic ‘anomaly’ allows Ethiopian Airlines to receive all air ticket money realised from travel agents across the globe who sell tickets on behalf of Malawi Airlines. Consequently, Malawi Airlines does not have any idea as regards the amount realised on a monthly basis,” reads the letter.
The organisation further says it should be noted that once the money is collected by Ethiopian Airlines, it is subjected to a 10 percent collection fee.
“Something that would not be the case if Malawi Airlines had its own boarding code, say MWW. All the money would come through to Malawi Airlines account,” Cdedi claims.
According to Cdedi, another interesting aspect of the contract is that all aircraft belong to Ethiopian Airlines and operate as Malawi Airlines on lease, meaning in the event of termination of contract, Malawi will be left without any aircraft.
“The lease fees are determined by ET itself. Thus, ET deployed an engineering team into Malawi who service the aircraft at very exorbitant monthly fees paid to ET.
“Ethiopian Airlines also receives management fees. The rate was determined by Ethiopian Airlines itself at the start of the company and this rate keeps changing every year,” alleges Cdedi.
It also claims that the money realised over the period would have allowed Malawi Airlines to acquire more than two of its own aircraft.
“However, Ethiopian Airlines would not in any way wilfully do this as it will cut significantly the colossal money it realises through aircraft leasing. If the above findings are anything to go by then Hon. AG you will agree with us that, just like SSCL, there is an urgent need for a forensic audit on Malawi Airlines,” reads the letter.
The AG was not available when contacted for comment yesterday.
