Sunday, April 18, 2010

Europe’s cloud of ash costs Kenya Sh300m a day

An empty arrival hall at the Jomo Kenyatta International  Airport in Nairobi on Sunday. Photo/William Oeri

An empty arrival hall at the Jomo Kenyatta International Airport in Nairobi on Sunday. Photo/William Oeri 

By NATION Team

The cancellation of flights to and from Europe is costing the Kenyan economy more than Sh300 million daily, the Nation learnt on Sunday.

The horticulture industry has been hardest hit, losing an average of Sh231 million, with national airline Kenya Airways shedding Sh77 million for every day it is forced to cancel flights to Europe.

A volcanic eruption in Iceland has affected business globally. Media reports said airlines worldwide were losing $200 million (Sh16.9 billion) a day while Kenya Airways has lost Sh308 million in the four days it has cancelled flights to Europe.

The Fresh Produce Exporters Association of Kenya chief executive officer Stephen Mbithi said: “On average, we ship some 1,000 tonnes worth $3 million (Sh231 million) per day.”

“We have handled drought, El Niño and the post-election violence, but we have not seen anything like this,” Mr Mbithi said.

He described the situation as “disastrous” and said it is likely to substantially reverse the gains the sector has made over the past two decades, especially with the small-scale farmers.

At the Coast, some hotels are also suffering unexpected losses.

Serena Beach Hotel general manager Charles Muya said the hotel is expected to suffer a loss of more than Sh3 million as more than 100 holidaymakers from Europe have been affected by the flights setback.

The case is the same at the Sarova Whitesands Beach Resort where general manager Mohamed Hersi said over 100 visitors from Europe were stranded.

However, the Kenya Association of Hotelkeepers and Caterers Coast branch chairman, Mr Titus Kangangi, said the impact of the flights hitch would not be felt much, owing to the low tourist season.

Expectations were high that flights would resume by Sunday morning, but by Saturday, it had become apparent that the cloud of ash hanging over Europe had dimmed any hopes of a quick resumption of international trade.

The ash from Iceland’s Eyjafjallajökull volcano is dangerous to aircraft because the tiny fragments of the erupted rocks can get into jet engines, shutting them off and even damaging the plane itself.

It is hard to predict how much longer the volcano will continue spewing ash clouds into the atmosphere, but University of Nairobi geologist Isaac Nyambok told the Nation it could be anywhere between a week to six months.

Tectonic plates

There are rare cases in which volcanoes have erupted for a year.

Prof Nyambok said that Iceland lies on the boundary of two tectonic plates, which are currently tearing apart.

Kenya Airways chief executive officer Titus Naikuni said that the overall effect is likely to become worse than the one after the September 11,2001, terrorist attacks in the United States.

“The only good news is that we have not had any accidents,” said Mr Naikuni, adding, “it will start unfolding on Monday and Tuesday when people go back to the offices and start calculating the losses.”

The CEO said it would take a week to clear the backlog if and when flights resume. About 2,700 people were booked on the airline since Thursday and 70 of their staff are stranded in Amsterdam and London.

Water minister Charity Ngilu could also be forced to stay longer in London as trains to other parts of Europe have been overbooked.

Mr Naikuni said industries that require spare parts from Europe could also be affected if their machines break down.

To make matters worse, cargo holders at JKIA have started asking owners of stored produce to pick it up, meaning they will have to pay to take it back for possible disposal.

“The headache now is where to take the produce. Do we dump the flowers in Dandora? What about the fruits? Where does one take so many? They might have to be donated to charities,” said an equally distraught Kenya Flower Council CEO, Mrs Jane Ngige.

The industry will meet on Friday to discuss the way forward.

Unlike Friday and Saturday, there was little activity at the international departures’ section at JKIA with the few passengers who turned up going back to their hotels almost immediately.

Reported by John Ngirachu, Catherine Riungu and Mathias Ringa

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