Kuwait Airways down in the dumps

Following the war in Iraq and the outbreak of the SARS virus, Kuwait’s national carrier becomes the latest to announce yearly losses.

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By  John Irish Published  May 27, 2003

Kuwait’s national carrier announced yesterday May 26 operating losses of approximately KD32.6 million (US $109 million) in the year to March according to Reuters. Despite this, revenue from passenger business increased to KD152.8 million ($512.9 million).

The airline, which has continuously suffered since the Gulf war in 1991, cited the recent conflict in Iraq, ongoing military threats from the former Baathist state and the lingering effects of 9/11 as the main causes for the underperformance.

During the war Emirates Airlines had agreed to endorse tickets valid on Kuwait Airways (KAC), after the Kuwaiti airline suspended all its services with the exception of those to Dubai and Cairo.

However, despite these latest figures, Ahmad Al Zibn, KAC’s chief executive stressed that he hoped the situation would improve now that the geopolitical situation had changed.

“We are still hopeful because we expected a much bigger loss. This shows that we are getting out of the tunnel of financial problems of the past few years,” said Ahmad Al Zibn, chief executive, Kuwait Airways.

During Iraq’s occupation of Kuwait in 1991, the airline lost 84% of its assets and has been unable to pay debts resulting from a fleet purchased after the first Gulf War.

Additionally, following the company’s projected shortfall for 2002/2003, the Kuwaiti parliament called for an investigation into the airlines recurring losses and the possibility of corruption, thus holding back any plans to expand or modernize the fleet.

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