ENTEBBE – The team assembled by the Ministry Works and Transport to oversee the revival of Uganda National Airlines has warned that failure by Government to secure the Shs575b recapitalization would likely throw the airline out of business prematurely.
Giving the warning was Mr. Cornwell Muleya, the technical advisor to the company who had appeared alongside Ministry of Works Permanent Secretary, Waiswa Bageya and Moses Sanon, Head of Monitoring and Evaluation, at National Planning Authority to defend the budget proposal of Shs575b that is required to bring the recently revived airline to life.
Mr. Muleya told MPs on the Budget Committee: “You have to put confidence in the airline, you have to put the brand in the market, this takes time and investment, that is where the capital is going. This is why we need these funds, if we don’t get these funds, we will not be able to do this and you will not succeed because the foundation is going to be weak.”
Muleya informed the committee that they plan to spend USD5m on advertising, USD16m on direct costs, $9.2m on paying commercial costs among others.
However, the MPs were not convinced with the explanation provided with many wondering if the airline intends to rely on budget support and what plans the faces behind the airline have to make the airline self-reliant.
Mr. Muleya told the Committee that according to the business plan, the airline will make profits on local routes with 3years and international route Shs5years.