HARARE - The Civil Aviation Authority of Zimbabwe (Caaz) is currently technically insolvent and is saddled with a $240 million debt that is weighing down its operations, a top official has said.
Joel Masuku, Caaz’s finance director, yesterday told the Transport and Infrastructure Development parliamentary portfolio committee that the aviation body has a negative net asset value and that its liabilities are greater than its assets.
“We are technically insolvent, meaning that we are still a going concern, we are still doing business and operating on a cash basis. Business is normal and you can’t see any trace of insolvency as we operate business.
“But when you come to the figures, you will find that our current liabilities are now more than the current assets,” Masuku said.
He noted that the parastatal was facing litigation due to the unserviced current liabilities.
“We are looking at legacy loans that cannot be support by our assets at the eight airports that we operate from… fortunately we do not have any legacy debt relating to salaries and wages. It is the legacy debt from offshore loans that we are faced with,” he said.
Masuku noted Caaz was facing a $240 million debt overhang at a time when it is in dire need to recapitalise its operations.
Of the eight airports Caaz is operating from, five of them cater for domestic flights and are loss making, contributing one percent to the organisation’s total revenue of between $2,2 million to $2,6 million per month.
“Harare International Airport contributes 75 percent, Victoria Falls 16 to 18 percent and Joshua Mqabuko Nkomo about six percent,” he said.