eBusiness Weekly
Darlington Musarurwa
Eight international airlines have suspended selling their services from Zimbabwe after debts owed to them by local travel agents rose to over $20 million, fanned by biting foreign currency shortages, according to industry sources.
However, the Reserve Bank of Zimbabwe (RBZ) has raised its payments to International Air Transport Association (IATA), a trade association representing the interests of the world’s airlines, to clear the debt, the sources said.
All payments accruing to airlines are routed through the Canada-headquartered group.
Depleted nostro accounts have been making it increasingly difficult to switch from bond note denominated payments to US dollar-based settlements.
And local travel agents have been affected the most.
Industry sources told Business Weekly that at least eight airlines, including German-based Lufthansa, which used to have local offices for processing payments, had discontinued their operations.
Local travel agents either charge between 5 percent and 7 percent of the base fare (before taxes), or Association of Zimbabwe Travel Agents (AZTA) recommended fees of between $30 to $60 for a domestic air ticket, $40 to $70 (regional) and $80 to $200 for an international ticket.
This is, however, to the discretion of the agency.
Attempts to get a comment from AZTA chairperson Betty Katiyo were fruitless by time of going to print.
Officials from the association referred this paper to the Zimbabwe Council for Tourism (ZCT), an industry representative body that has more than 60 travel agents in its books.
Clearing the Debts
ZCT chief executive officer Paul Matamisa indicated that the central bank is seized with the matter and has since increased payments to liquidate the debt.
“What the Reserve Bank has done is to improve what we have been getting. The payments have increased significantly. Every week, we used to pay $2 million to the international airlines.
“Most of the business passes through travel agencies and they are bound to be affected if the airlines are now pulling out; they are not willing to sell their services from Zimbabwe. Well, the implication is that it is business taken away from the travel agent,” he said.
“We have been having meetings and discussions with the relevant authorities, and we always want to get to the leading agency here, which is AITA, to give us direction and what they want us to do.”
Board of Airlines Representative (BAR) chairperson Winnie Muchanyuka, who requested questions in writing, hadn’t replied to enquiries by the time of going to print.
RBZ statistics show that $57,3 million had been spent on AITA and airlines during the January-June period, of which banks funded $13,5 million.
But ZCT wants the obligations to be paid as soon as possible.
“We need to clear the arrears. My wish is that they will clear them tomorrow. That way we can attract those airlines that have withdrawn,” Matamisa added.
The ZCT chief said the ideal situation was for Zimbabwe to set up a dedicated fund for remitting payments to the airlines.
“We need to look at the bigger picture — for us to get business, to get trade, tourism and otherwise — there has got to be movement of people. Today, the efficient mode of transport is airlines. Now, if the airlines are unable to access Zimbabwe for any other reason, then you are in trouble.”
Government, through the Ministry of Tourism and Hospitality and the Zimbabwe Tourism Authority (ZTA), is alive to the current challenges and discussions still continue.
