Impact of Tanzania canceling traffic rights, truth is they have outwitted Kenyans!

Nafasi za Ajira Zilizotangazwa Leo Bonyeza Hapa


Impact of Tanzania canceling traffic rights, truth is they have outwitted Kenyans!

Penning 🖊my journal. A friend called Wuod Baba this afternoon asking me what I thought about Tanzania cancelling traffic rights into Kenya. Thought he was joking, countries do not cancel traffic rights between each other unless they are at war! 

Canceling of traffic rights reflects a sore relationship, between countries which restrict movement between states. A sad stare of affairs . 

My first reaction was to pore into the internet to establish if true?  Haven’t read the papers 10 years now, can’t stand the pessimism. 

Will analyze the impact of this action in layman and avoid aviation jargon to keep it simple. 

Tanzania basis for withdrawal of traffic rights to Kenya, is it applied for 5th freedom rights to ferry cargo out of Nairobi but was denied. 

You may want to ask what’s 5th freedom? 

The fifth freedom right is the right of aircraft of country A, from a service originating in country A, is allowed to embark passengers and cargo in country B and disembark them in country C. 

Countries usually are stingy with 5th freedom rights cause it grants it access to take cargo/ passengers onwards to another country other than that it originated. The stinginess usually comes from the protest of its national  carrier or other air operators from that country. 

Let me delve a little into how traffic rights are dished in Kenya, for decades played part of the process & know it from the back of my hand. 

Kenya Civil Aviation Authority (KCAA) in liaison with the Dept of Air Transport in Ministry of Transport receive applications for charters & traffic rights. They however cannot issue traffic rights without involving the national carrier Kenya Airways & other officially designated Kenyan carriers. 

Every season KCAA receives applications from entrants, they list all the applications & call the national carrier & stakeholders for a forum to gather their views. 

If the national carrier & other local carriers object to the new entrants, it is most likely that the prospective carrier in this case Air Tanzania was denied traffic nights. 

Wait a minute, it’s rare for countries to deny cargo applications for freight exclusive  flights . This is because air cargo involves trade. By denying an air cargo license to operate the country stifles trade. Passenger applications are often denied but cargo licensing is usually more liberalized worldwide.

The stark truth is that it was odd for the Tanzanian application to be rejected. That’s the cause of the whole wrath. Someone goofed, and the Tanzanians breathing fire. The leading question, is why were they denied? The regulator will be soon prompted by public for an explanation.

Let me delve a little on what’s happening in Air Tanzania, I worked professionally with some of the top management staff in the 90s. Tanzania recently acquired a dedicated B767 Freighter from Boeing 6 months ago. This puts the Tanzanian in the big league as far as cargo is concerned as it can uplift 52 tons inter continental to Europe. 

Most people are unaware, that JKIA is more world renowned for cargo than for passenger traffic. Infact it’s among the world’s top fresh produce & flower airport destinations . 

Every week at least 5000 tons of perishable horticultural produce is airlifted from JKIA to Europe. This requires an uplift of at least 700 tons a day. In order to do this at least 7 to 10 freighters swarm into JKIA to uplift fresh produce, the peak is Valentines Day Feb 14 and Mothers Day 12 May.

The truth of the matter is that there has always been a shortage of air freight capacity out of JKIA, that’s why air freight is expensive. It makes sense for the government to license as many cargo carriers as possible (including the Tanzanians) as it would make freight cheaper for our farmers to export to European markets. 

Air freight is tricky cause it’s uni- directional affecting the flight operational costs, hence on one leg you fly empty & this deters some cargo carriers from the market. 

Am not sure the exact 5 th freedom routes the Tanzanian were denied my guess Europe could be amongst them, and if it’s Africa, why are we stifling African trade.

Kenya Airways unlike Ethiopian has never seriously dabbled in the air freight industry despite being in a country which is one of worlds largest flower and  horticulture producers. 

KQ recently made its entree & acquired 2 B737 F which uplifts 18 to 23 tons at best. The aircraft can’t carry cargo on intercontinental flights & best suited for regional cargo in central & east Africa region. 

KQ’s freighters offers little or no competition to AirTanzania who will play, in a bigger league with its B767F . 

I have expressed opinion in many forums, that KQ should have acquired a larger aircraft eg B767F as part of its cargo strategy to feed it B737F (that ply its regional routes) with intercontinental cargo. Currently as KQ network stands , KQ has capacity imbalances in its regional  & incontinental routes & needs to address this weakness which leads to capacity constraints. Perhaps a story for another day. 

Tanzanians reaction is heavy handed, chose to hit Kenyans where it hurts and cancelled 3rd & 4 th freedom rights of Kenya Airways. Which technically means Kenya Airways will soon have no traffic rights to operate into or from Tanzania.  The rider is that the traffic rights will be withdrawn as from 22 Jan. This is an extremely smart chess check mate move, they want to give Kenyans only a week to rethink.

The Tanzanians for a long time have their own beef with Kenyans and thrown a knockout punch, they are unlike the Dutch who chose not to deny us traffic rights to Amsterdam when we recently denied them rights to Mombasa.

My prediction, we are caught in a net & Kenya will quickly back track and grant the Tanzanians rights they sought. Will move to tell you why and go into its mathematics . 

Kenyans are the market leader on the NBO DAR route, & have more to lose. KQ operates under 3 umbrellas, that is KQ proper and it’s wholly owned subsidiary Jambo jet, plus a third little known arrangement with Precision Air ( PW) under a code share arrangement, which does 3 to 4 flights a week, mostly concentrated towards weekend leisure traffic. I was key in founding the KQ / PW partnership with legendary then CEO Alphonse Kioko & late brilliant Joel  Chemwitich in 2005. 

Tanzanian withdrawal of traffic rights will automatically affect the traffic rights to Jambo Jet cause its wholly owned by KQ, take thar to the bank. It’s one and the same company, 

The code share between PW /KQ will also be affected cause the Tanzanians will revoke KQs call sign to be reflected in the reservation distribution system due to the ban on KQ. 

Now for the mathematics. Will give you my rough cut of it cause I have no access to KQs reservation system but this is the general drift of the loses KQ will face.

KQ I believe & Jambo Jet each operate daily flights to DAR. That works to at least 28 flight legs. My assumption is KQ has a revenue yield of Kes 25000 one way, with average uplift of 60 passengers a flight . We are talking 60 x 25,000 x 28 x 4 weeks a month is 168 million a month .  

I havent included passengers who are coming from international destinations hubbed through KQs Nairobi hub eg, USA & Europe going to Tanzania & this figure will hit over Kes 200 million monthly. Passengers whose flights were cancelled due to the denial of traffic rights will demand compensation. 

KQ’s aircraft doing the route will sit idle and wear tear costs money. The Kenyan Civil Aviation Authority  & Kenya Airport Authority will lose money in terms of parking, passenger taxes, navigation fees etc. Fuel company will lose, not to mention NAS catering services, taxi companies will lose. 

It is not sustainable for KQ . Am sure the Tanzanians are aware of that, for that reason gave the Kenyan government until 22 Jan to grant Air Tanzania 5 th freedom rights on the grounds of reciprocity. If things fail, the mode of public travel to Tanzania will be by bus. 

KCAA & /Kenya Airways will move quickly to the negotiating table to avoid the inevitable, trust me. They will be negotiating from a weaker position. The sad of it all, we as members East African Community need ask ourselves what is the community all about. Does it have to come to this? We as a country need to re-examine our aviation policy.

Mobile calls to Tanzania is really expensive over Kes 30,a minute, is this by intent? The truth is the relationship between Kenya & Tanzania is at best frosty. This issue should have been resolved within the ambits of the EAC.

What we need in Africa is liberation of air travel. Playing hardball stifles competition & makes air travel expensive for the consumer, and bottlenecks trade. The principles of Yamoussoukro convention which all African countries including Tanzania & Kenya subscribe too have never been implemented, 

The day when African countries allow for cabotage rights for all African carriers will change aviation in Africa. Cabotage means allowing carriers from other countries rights to operate in each others domestic markets. 

May our children implement what our fathers, & we have failed to do. May my dream come true.
#okwiri 🖊 my journal, my thoughts, my walk..
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