Govt proposes changes for AOC to airline not plane

DODOMA: THE government has proposed changes on charging a fee for renewing licences to operate safety planes from an aircraft to a company.

The Finance Minister, Dr Mwigulu Nchemba, tabled the proposal on Thursday when presenting the national budget for next fiscal year.

“The aim of this measure is to reduce the costs of doing business in the [aviation] sector and stimulate the growth of the aviation Industry [in the country],” Dr Nchemba said.

The ministry proposed that the Air Operators Certificates (AOC) to be reduced to 600 US dollars per company instead for the same amount per aircraft per year.

According to Tanzania Civil Aviation website, there over 200 domestic registered aircraft in the country.

Additionally, there around 15 domestic airlines operating in the country—where Air Tanzania (TC) is commanding a big market share followed by the Precision Air (PW).

Also, the Minister said the construction of various airports is progressing well and some have reached an advance stage. He said the Msalato Airport terminal buildings construction reached 22.6 per cent and runway infrastructure 56.9 per cent.

ALSO READ: Tanzania enjoys airline passengers upsurge

“This construction goes hand in hand with the construction of airports of Tanga, Lake Manyara and Iringa,” Dr Nchemba said. The projects, some of them, scheduled to be completed in 2024/25.

Ministry of Transport increased its budget by 23.4 per cent to 2.73tri/- in 2024/25 from the previous year. Tanzania Music Rights Society, Operation Director, Kelvin Msangi, said the amount set for the ministry’s development at 2.61tri/- targeting transformative projects to bolster the nation’s transport framework.

“These investments, including major renovations at Kilimanjaro Airport and upgrades to the Standard Gauge Railway, are essential for modernizing the nation’s transport infrastructure,” Mr Msangi told Daily News.

However, he said, this focus on development comes with a significant reduction in operational expenditures, which raises concerns. The budget designates only 4.2 per cent for recurrent expenses, a slight decrease from the previous year, which could lead to service disruptions, maintenance backlogs, and a decline in service quality.

“Insufficient funding for routine maintenance can quickly undermine the benefits of new infrastructure, causing it to deteriorate and negating long-term gains,” he said.

The fiscal strategy for 2024/25 anticipates the transportation sector to generate approximately 2.32tri/- in revenue.

The Tanzania Civil Aviation Authority, Tanzania Railways Corporation, and Tanzania Ports Authority are set to be key revenue generators, with the latter aiming to secure 79.26per cent of the projected revenue through extensive port upgrades.

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