AIRTRANSPORTANNUALREPORT2012 - Archive
AIRTRANSPORTANNUALREPORT2012 - Archive
AIRTRANSPORTANNUALREPORT2012 - Archive
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IFCPROJECTHIGLIGHTS<br />
<br />
Tanzania—PrecisionAirExpansion<br />
PrecisionAirServiceLimited.thelargestTanza<br />
niabasedairline,isundergoingagradualfleet<br />
expansionalongwithfinancingregularcompa<br />
ny’scapitalexpenditure.TheCompanyplansto<br />
increase its fleet with 5 addional aircras to<br />
comeby2015,2tobeownedandtheremain<br />
derthroughleases.Themajorpartofthefleet<br />
expansion will be with the turboprop ATRs to<br />
caterforshorthaulanddomescmarkets,but<br />
the company also plans to expand its narrow<br />
body fleet with an addional Boeing 737 300<br />
series for the medium haul and regional mar<br />
kets.<br />
PrecisionAiraimstotripleitscapacity(ASK)as<br />
wellastogrowthenumberoftransportedpas<br />
sengersfromcloseto1millionperyeartoover<br />
1.6millionanddoubleitsrevenuesby2016.To<br />
finance the resulng capital expenditure, the<br />
airlinehasraisedTZS11.84billion(orUS$7mil<br />
lion) through an IPO in November 2011. The<br />
Companyplanstocompleteitsfinancingneeds<br />
withinternalcashflowgeneraonandexternal<br />
debt.<br />
IFCiscontemplanganinvestmentofUS$4to<br />
US$6million,whichwillcontributetofinancing<br />
theCompany’scapitalexpenditure.<br />
Fromasocialandlaborpointofview,Precision<br />
Air'sproposedcapitalexpenditureisexpected<br />
tohelpcreangalilelessthan600newjobs<br />
inTanzania(currently771employees)mostof<br />
whichareofatechnical/qualifiedlabornature.<br />
Addionally, the opening of over 10 new re<br />
gional desnaons will contribute to a higher<br />
marketsintegraoninSubSaharanAfricaand,<br />
in parcular, in the fastgrowing East African<br />
region and foster tourism in a highpotenal<br />
touriscarea.Moreover,thiswillhelpremote<br />
Tanzanianregionsgetabeeraccesstoother<br />
countries of SubSaharan Africa in a region<br />
wherethereareoennolandtransportalter<br />
naves. Finally, the Project will contribute to<br />
improved safety and reliability of flights to/<br />
fromTanzania. <br />
<br />
<br />
Brazil—GOLFinancing<br />
Aordableandecientairlineservicesarevital<br />
in Brazil, given the size of the country and its<br />
inadequate rail transportaon infrastructure.<br />
However,historicallyhighdomescfaresinBra<br />
zilhavereservedtheaviaonmarketforasmall<br />
segmentoftheBrazilianpopulaon.<br />
The entry of the first lowcost airline Gol into<br />
themarkethasloweredthecostsofairtravelin<br />
Braziltobothbusinessandleisuretravelers,and<br />
has thus made air transportaon accessible to<br />
the general populaon. Gol is now extending<br />
thebenefitsoflowcosttraveltootherregional<br />
desnaons including Argenna, Bolivia, Uru<br />
guay and Paraguay. Gol’s lowcost model will<br />
also contribute to making the industry more<br />
compeveandmoreecient.<br />
The company’s strategy is to grow its business<br />
by popularizing air travel, smulang and<br />
meengdemandsforaordableandconvenient<br />
airtravelinBrazilandbetweenBrazilandother<br />
South American desnaons for both business<br />
and leisure passengers. It currently oers over<br />
470dailyflightsto49majorbusinessandtravel<br />
desnaons in Brazil, Argenna, Bolivia, Para<br />
guay and Uruguay. GOL’s longterm business<br />
objecve is to bring aordable air travel to all<br />
significant desnaons in South America.<br />
TheIFCprojectisa$50millioncorporateloanto<br />
the company for the financing of spare parts<br />
andworkingcapital.<br />
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