This week, Rwanda hosted the Africa Aviation 2017 Summit at Kigali Conventional Center. RwandAir, the national carrier of the republic of Rwanda has attracted a lot of attention over the past 5 years, earning a reputation of one of Africa’s fastest growing airline. As the IOSA certified airline and member of IATA, RwandAir flies to about 20 destinations across the continent and the Middle East and very soon targeting the European and American market. The airline is increasing the number of its fleet and last year acquired two brand new Airbus A330s, new Boing 737-800 NG and is awaiting for more to come. In an exclusive interview with The New Times, John Mirenge, the CEO of RwandAir speaks about the airline future plans, the role of the airline in the country’s economic growth and how it fits into the global aviation business.
You recently acquired the magnificent Airbus A330s. Where is it going to fly to? Any new destinations lined up?
With our growing fleet, this year RwandAir is spreading its wings by increasing its destinations from the current 19 destinations to about 22. The new destinations will include Mumbai (India) and Harare (Zimbabwe) very soon, and later this year Gatwick -London via Entebbe and New York will add up. We are looking at a few other East African capitals to have them connected to the Mumbai route. Our target in the current financial year is to end it with at least 750,000 passengers.
You have been spreading your wings on the African continent; what are your plans as far as Africa is concerned?
We intend to add more destinations and fly to Conakry in Guinea, Bamako in Mali and eventually Dakar in Senegal. In Southern Africa, we will go to Harare in Zimbabwe, Lilongwe in Malawi and Durban in South Africa.
This requires a lot of capacity in terms of technical expertise, infrastructure and equipment, where do you stand currently?
RwandAir is well equipped, our fleet is growing very fast. Last year we acquired two brand new Airbus A330s with triple cabin and inflight connectivity and brand new Boeing 737-800 NG growing our fleet to 11. And another Boeing 737-800 NG is coming very soon.
In terms of capacity building, we are recruiting experienced pilots, ground operation engineers and other staff and also welcome partnership with other airlines such as Ethiopian Airline to further boost our capacity. We also have code share agreements with SN Brussels, Turkish airlines and South African airways among others.
Most airlines on the continent are either quitting business or struggling to make a profit. Where does RwandAir’s optimism come from?
Rwanda is positioning itself as a service, tourism and conference hub in the region. All these sectors need seamless connection to become more productive and profitable. Moreover, Rwanda is increasingly attracting foreign investors who travel to see for themselves how it is good to do business in Rwanda. In addition to that the government of Rwanda has made a choice to invest in aviation sector because this sector is seen as the pillar and key enabler of Rwanda’s economic development.
A number of African states have refused to open their skies to each other despite adopting the Yamoussoukro Declaration in 1999, what is your experience with RwandAir?
In line with the Yamoussoukro Declaration, we would wish to be exercising full rights across the continent to enhance connectivity. However, some member states have been reluctant to have the requirements implemented. In-fact, not opening up sufficiently to boost aviation industry on the continent has become the biggest barrier to the continent’s aviation business.
What strategies do you have to ensure the country’s exports reach to those destinations you fly in?
As an airline, we always look at the needs of the country and we prioritise. We are aware that Rwanda has been working hard on its export capability. We are now offering the massive bellies on our wide body aircraft to guarantee the exporters that they will have tons of their perishable or non-perishable goods reach their destinations safely and in good quality. With demand, we will also think about introducing cargo flights.
The construction of a new bigger and better airport has already begun. What does this mean for RwandAir?
Kigali International Airport is already congested and yet our order book is not stopping at A330s. We already have the A350 airbus lined up, with the delivery expected in 2019. Therefore, constructing Bugesera International Airport is no longer a choice but a necessity. With our current growth, both in terms of passengers (planning to be carrying over a million passengers per year) and fleet numbers, a new airport is the ultimate answer. We are fortunate the government has been so supportive and working within our growth plans.
What are you doing to ensure quality services and safety for your passengers?
There is no better assurance than to have a commitment to always be IOSA certified company. Beyond that, we continue to work internally to further boost our quality and safety standards. We work hard on our on-time performance and product quality to ensure efficiency. We recently became the first on the continent to introduce on-board Wi-Fi connectivity. This is in the line of giving our customers’ world class service and improve their comfort.
There must be some challenges…
Africa has been going through a depression in the last one year and half which has affected the profitability of the sector. In addition, today we are talking of descent oil prices but we are not sure what it will be in the next five years. At the height of it all, you spend more than 50 per cent of your revenues on jet fuel. And, in Rwanda it even becomes more expensive because of our geographical location.
Moreover, lack of enough skills is a specific challenge to the development of Rwanda’s Aviation sector. We have to depend on expatriates for pilots, technical and aircraft engineers and sometimes managers, which comes at a cost. The insufficiency of US dollars across the continent is also a challenge because, despite that it is hard to find, we buy everything in US dollars.
However, we are optimistic that the situation will eventually improve and business will pick up within the next 5 years. You don’t invest in planes with life span of 30 years and you don’t take the pain. At RwandAir, we take the pain but we are confident and positive.
Why is flying to destinations like Dubai cheaper than flying to the region ( like Entebbe that is much closer)?
High taxes! Most states see aviation as a source of revenue instead of seeing it as an enabler to promote economic growth. We have been engaging and pushing for solutions. Let’s wait to see how the situation unfolds.
Some media reports have indicated that you are privatising the airline on equity share arrangements, what exactly is happening?
The process of privatisation by nature is a very complex and a slow one unless you want to give or throw away, which we don’t want to do.
What we are doing today, is building the capacity at RwandAir, and positioning it into its core functions which is to serve and open Rwanda to business, tourism and conferences. Until we build RwandAir’s capacity in terms of revenue generation, passenger numbers, the desire is low, so this is the reason we are building capacity. Our pre-occupation for now is not looking for buyers because we may end up with a bad deal.
Has anybody expressed interest?
Of course, many buyers are interested. Moreover, that is not going to blind us from our focus because we are currently doing a very good job. However, if a good partner comes along and offers something that is acceptable and in line with the vision of our country, then we can partner. We believe that this industry succeeds better when we make good partnerships.
Paint for us a picture of RwandAir in the next 10 years!
The future is very bright especially when you look at where the airline was 5 years ago. We were carrying a quarter of the passengers we are flying today. Our clientele on the content has come to believe in us, which we appreciate. The path is upward! As we add more routes and when the new Bugesera airport is ready, we will turn Rwanda into the aviation hub in the region.