Mozambique: LAM’s future lies in new African routes

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Mozambique: LAM’s future lies in new African routes

7:18 CAT | 04 Jul 2023

LAM on Friday inaugurated a new route between Maputo and Lusaka, capital of Zambia [Photo: LAM]

The Mozambican government argues that one way to save LAM from insolvency is to explore new routes. The Maputo-Lusaka flight was inaugurated this Friday.

The Mozambican Minister of Transport and Communications is urging the exploration of new international routes as one way to secure the recovery of Linhas Aéreas de Moçambique (LAM), noting that the carrier needs time to become more “relevant”.

“[The creation of more routes out of the country by LAM] is a way of solving our problems”, Mateus Magala said on Friday evening (30-06) after the inaugural LAM flight between Maputo and Lusaka, the capital of Zambia.

Noting that the Mozambican flag carrier must take safe and significant steps to consolidate the recovery process, Magala said that the future involves exploring new destinations in Africa and other continents, “travelling to profitable destinations”.

He considered “historic” LAM’s unprecedented commercial flight between Maputo and Lusaka, the southern African city that 47 years ago hosted the signing of the Accords between the Mozambique Liberation Front (Frelimo) and the colonial authorities, paving the way for the independence of the African country in 1975.

Privatisation?

Magalalam.lam_

In view of the current transitional management of LAM by the South African company Fly Modern Ark, the Minister of Transport and Communications said that the Mozambican government would disburse “a lot of consideration” on the next steps, without preconditions as to whether the carrier should be privatised or not.

“The objective is, in the near future, to sit down and make strategic decisions for the future, which will project our airline as a relevant company in the civil aviation space,” he stressed.

But first, Magala continued, care must be taken that the mistakes that led LAM to insolvency are not repeated.

In May, LAM’s new management commission announced that the company was no longer insolvent, having since April collected US$47.3 million in overdue state and private accounts, but remained at risk of collapse.

“The debt position was reduced” improving the debt-to-equity ratio, leading LAM to “no longer being considered insolvent”, said Sérgio Matos on behalf of the company’s management committee.

Matos also added that the carrier’s rescue strategy involves reactivating the Maputo-Lisbon route and exploring new destinations in Brazil, India, Dubai and China.

Source: Deutsche Welle