The Kenyan government is all set to withdraw the financial support of Kenya Airways by the end of the year under a turnaround plan, according to a brief note in its draft 2023 Budget Policy Statement.
The airline has been making loss since the COVID-19 pandemic.
To support the aviation industry, the government will develop a turnaround strategy for Kenya Airways. A critical plank of this strategy will be a financing plan that does not depend on operational support from the exchequer beyond December 2023," the statement said.
In May 2022, the Kenya government approved a state loan of $173.9 million following which the airline borrowed another $95 million in the half-year ending June 30, 2022. This followed loans of 95.2 million in 2020 and 121.1 million in 2021.
In the meanwhile, the government is looking for cash-rich foreign airline to take over the airline.
Kenya Airways’ ongoing restructuring includes reducing its network, renegotiating aircraft deals with lessors, as well as seeking labour savings.