Airports agency starts to run KIA

Last week, MPs asked the government to inform the legislature why KADCO was still operating at KIA while its contract has ended.

Transport minister Prof Makame Mbarawa tabled a report on the move, saying KADCO, a company registered on 11 March, 1998 under the Companies Act, Chapter 212 of the laws of Tanzania, was handed the KIA operational franchise as part of the privatisation policy during the third phase government.

“The government decided on July 6, 1998 that KIA operations be run by the private sector,” he said, explaining the decisions as relating to high running costs for the airport “as the Tanzania Airports Authority (TAA) was not established by then.”

KADCO and the government entered three contracts also involving a shareholder and a leasing agreement, he said, elaborating that on May 14 2009, the government decided to buy shares in KADCO and that eventually KIA should be handed over to TAA.

“From 2010 KADCO ran the airport through the leasing agreement whose legal validity has expired,” he stated.

“As KIA is owned by the government through TAA and the contract for running the airport has ceased, KIA will now be run by TAA as Parliament demanded,” he declared.

KIA is the third busiest airport after the Julius Nyerere International Airport (JNIA) and the Abeid Amani Karume International Airport, and the gateway to the country's main safari tourism hotspots in the northern circuit.

Informed sources said that sometimes in the past the government sought a review of the terms of the concession agreement, but the shareholders rejected any amendments.

In 2009, the government decided to buy out the shareholders of the company and acquired 100-percent ownership of KADCO.

It remains unclear how much the government actually paid the shareholders to relinquish statutory control of the company, interviewed officials intoned.