Kenya Airways Responds to Deputy President Gachagua's Claims of State Capture

Kenya Airways (KQ) has responded to Deputy President Rigathi Gachagua’s claims that the airline is under State capture.

Gachagua, who spoke in an interview with Citizen TV on Sunday, blamed the national carrier’s financial woes on bad contracts allegedly entered into to benefit a few individuals in what he termed as State capture.

“We have had discussions with Kenya Airways and they have the highest fares on the continent and their planes are always full but they make losses. We are trying to deal with that State capture so that we can bring down the cost of the operations of the airline so that they can make profits,” said Gachagua.

But KQ Chairman Michael Joseph on Thursday refuted the deputy president’s claims, stating that all its contracts are purely commercial business arrangements aimed at benefiting the airline.

Joseph stated that KQ entered into lease agreements with renowned international companies that manage hundreds of aircraft leased to different global airlines. These include long-term leases with an option to purchase the aircraft at the end of the agreement and operating leases where both parties agree to a plan for a set period of time in exchange for regular payments.

He similarly disputed claims that the loss-making airline pays above market rate fees for services offered, saying the costs are within the prevailing market rates at the time of negotiating the transactions.

Joseph clarified that KQ is a publicly listed company with the Government of Kenya as the majority shareholder at 48.9%, followed by KQ lenders (38.1%), Dutch carrier KLM (7.8%), minority shareholders (2.8%) while employees of the airline hold 2.4%.

The chairman expressed confidence that KQ will turn around its fortunes by 2024, saying the strategies they have implemented are starting to bear fruit.