LILONGWE-(MaraviPost)-The country’s civil rights group Centre for Democracy and Economic Development Initiatives (CDEDI) is demanding a forensic audit on Malawi Airlines amid questionable 51% shares of Ethiopian Airlines in the flagship.
The grouping therefore wants an Attorney General (AG) Chakaka Thabo Nyirenda to explain to the nation on contractual agreement between Ethiopian Airlines and Malawi Airlines.
Addressing the news conference in the capital Lilongwe on Friday, January 12, 2024, CDEDI Executive Director Sylvester Namiwa observes that his organization’s independent investigations show that Ethiopian Airlines deliberately failed to register the airline code for Malawi, instead opting to use ET as the boarding code for Malawian Airlines.
“The Centre for Democracy and Economic Development Initiatives (CDEDI), writes you, Sir, concerning the above-stated subject matter. Building on the remarkable progress recorded thus far in the recovery of public funds that were invested in Salima Sugar Company Limited (SSCL) through the Greenbelt Authority (GBA), which started in earnest through the bold decision to make public the contents of the forensic audit the Malawi Government sanctioned on SSCL, CDEDI intends to draw your kind attention to a public-private partnership agreement that led to the establishment of Malawi Airlines.
“The Government of Malawi has 49 percent stakes in Malawi Airlines, while Ethiopian Airlines has 51 percent shares. This, therefore, as expected, means that its dividends ought to be declared and made public. Failure to declare dividends alone, begs the question as to how Malawians are benefiting from this arrangement,” said Namiwa.
He adds, “Given the above, CDEDI on behalf of Malawian taxpayers and voters, and in line with the Access to Information (ATI) Act, is imploring you, Hon. AG, to help Malawians exercise their right to know by doing the following; Make public how much Ethiopian Airlines brought on the table as their equity contribution. Thus far how much in profits have been declared? Explain with evidence what Malawi has benefited apart from the prestige of having a purported own airline when in reality it is not”.
Namiwa observes, “CDEDI’s independent investigations show that Ethiopian Airlines deliberately failed to register the airline code for Malawi, instead opting to use ET as the boarding code for Malawian Airlines. This systematic ‘anomaly’ allows Ethiopian Airlines to receive all air ticket money realised from travel agents across the globe who sales tickets on behalf of Malawian Airlines. Consequently, Malawi Airlines does not have any idea of the amount realized every month.
“Further, it should also be noted that once that money is obtained by Ethiopian Airlines, it is subject to a 10% 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 the Malawi Airlines account”.
Namiwa explains, “Another interesting aspect of the contract is that all aircraft belong to Ethiopian Airlines and operate as Malawi Airlines on lease. The lease fees are determined by ET itself. Thus, ET deployed an engineering team into Malawi that services the aircraft at very exorbitant monthly fees paid to ET.
“Ethiopian Airlines also receives management fees for operating the airline. The rate was determined by Ethiopian Airlines itself at the start of the Company in 2014 and this rate keeps changing every year. The Management fee, just like the Engineering fees paid in US dollars is no small money”.
He explains further, “In short, if there is a termination of the contract, Malawi will be left without any aircraft. The money realised over the period would have allowed Malawi Airlines to acquire more than two of its aircraft.
“However, Ethiopian Airlines would not in any way wilfully do this as it will cut significantly the colossal money it realizes 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 of Malawi Airlines. We are looking forward to hearing from you soon.
