Camair And The New Deal

Prof. Tazoacha Asonganyi, Yaounde

The fate of Cameroon Airlines (Camair) today reinforces the idea that ownership by the state is
ownership by an impersonal entity which amounts to control by politicians and civil servants.

The aim of the privatisation process started a long time ago was to sell off public enterprises in order to shift the balance from the inefficient, unaccountable state to the more efficient private
business.

It was supposed to introduce popular capitalism by ensuring the widest ownership of shares by members of the public, to reduce the power of the State and enhance the power of the people. In State-owned structures like Camair, targets are set, new management appointed, performance monitored, warnings given; but these never work like in private business because it is the State that accounts for weaknesses to the State, not management to shareholders.

Crony-run public corporations like Camair have since discredited the public sector that dominated left wing and third world economies, because they allowed too much borrowing and expansion without due regard for adequate returns. The corporations were bossed by inexperienced civil servants and shielded from the discipline of the market, so they were run on unprofitable bases and created no wealth.

This failure of State-run services contributed to the convergence of certain economic views between the socialists and capitalists and led to the resurrection of the market in all modern democracies - whether they were run by the left or the right.

This is why with the collapse of Soviet communism and the re-emergence of Russia, the Russian republic launched a grand privatisation programme. By the end of 1993, some 6.5 million State-owned apartments (about 20 percent of total) had been privatised.

By 1994, more than 139 million Russians had invested their government-issued privatisation vouchers, a participation rate of 94 percent; 70 percent of Russian industry (20.000 of the 28.000 large or medium sized industrial enterprises and 90.000 small firms) had been sold off.
Indeed, by July 1994, cash in-flow into Russia was around $500 million a month due to the explosive growth in stock prices!

Within this backdrop, how did Camair get to where it is today? Following the collapse of Air Afrique, Camair was established on July 26, 1971, as the national airline of Cameroon, a company owned by the Cameroon Government, 96.43 percent, and Air France, 3.57 percent.

In June 2000, probably to catch-up with new economic exigencies, Yves Fotso took up duties as
"Administrateur Directeur Général". He was later replaced by Dakayi Kamga, and then by Paul Ngamo Hamani who was appointed provisional administrator in February 2005 to prepare for
"privatisation/liquidation".

In 2006, the Cameroon government reached an agreement with SN Airholding, the mother company of SN Brussels Airlines to revive the airline, without much effect. Then a Presidential decree created a new company known as Cameroon Airlines Corporation, CAMAIR Co, to
replace Camair.

On 14 March 2008, government sacked Paul Ngamo Hamani and the Minister of Finance extended the mandate of the Liquidator of Camair by 12 months, with a co-liquidator, who would handle judicial matters about the privatisation...

To understand the present fate of Camair, it would be appropriate to examine the situation of other airlines related to it in one way or the other. Kenya Airways is said to have expressed interest in the privatisation of Camair. Kenya Airways was established in February 1977, after the demise of East African Airways and was wholly owned by the Kenyan government until April 1996.

As far back as 1986, the Kenyan government expressed the need to privatise the airline, "in line with the country's need for economic development and growth". The government named a Board Chairman in 1991 with specific orders to privatise the airline. In 1992, government set the privatisation of the airline as top priority.

In 1994 the International Financial Corporation (IFC) was appointed to provide assistance in the
privatisation process which ended in KLM buying 26 percent of the shares in 1997 and becoming the largest single shareholder. The shares were floated to the public and the airline started trading on the Nairobi Stock Exchange. Presently, it is owned by individual Kenyan shareholders (30.94 percent), KLM (now Air France-KLM) (26 percent), Kenyan government (23 percent), Kenyan institutional investorsCorporate-Governance-Ira-Millstein (14.2 percent), foreign institutional investors (4.47 percent) and individual foreign investors (1.39percent).

Kenya Airways has won the 'African Airline of the Year' award five times in seven years. In 2007,
SkyTeam, the second-largest airline alliance in the world, welcomed Kenya Airways as one of the first official SkyTeam Associate Airlines.

What of Air France, a partner of Camair at birth? In September 2003, Air France and KLM Royal Dutch Airlines merged to form Air France-KLM. With the merger, Air France shareholders owned 81 percent of the new firm, (44 percent owned by the French State, 37 percent by private shareholders), former KLM shareholders the rest.

By reducing the French government shares from 54.4 percent to 44 of the newly created Air France-KLM Group, the airline was effectively privatised. In December 2004 the State sold 18.4 percent of its equity in Air France-KLM to own less than 20 percent of the shares. Air France-KLM is the largest airline in the world in terms of operating revenue and third-largest (largest in Europe) in passenger kilometres.

These are examples of success, while Camair moved from failure to failure. So, why have others worked these "miracles" of success while our own national airline continued to move from crisis to crisis? Why is the "transformative intelligence", other people use to bring prosperity to their countries, absent in Cameroon?

Why are others busy putting into practice the knowledge they got from the schools we all attended together while we in Cameroon are busy celebrating the certificates and bathing in cronyism, tribalism, corruption and other unpatriotic ills? Why is the government stock with the privatisation of Camair?

Central to using "transformative intelligence" to conquer underdevelopment and mass poverty and generate economic development is the ability of the individual citizen not only to form and hold conceptions of excellence but to realise them. This is only possible with "free", happy individuals! Such individuals are a product of the rule of law, checks and balances, strong social contracts and the attendant universal rights of the human being.

These concepts we parrot everyday were conquered through serious struggles in history to put the individual citizen as the centrepiece of the modern political and legal systems. The individual citizen is protected and glorified by the universal declaration of human rights and freedoms
and the African charter on human and peoples' rights, and highly valued and respected in their countries because all "transformative intelligence" is the product of the human mind.

Indeed, the material culture that defines much of what we call "development" flows from the minds of individual citizens. This is why it is usually said that the individual citizen represents the hen that lays the "golden egg" of development for a country, and so must be provided the environment to mature the eggs! The individual citizen has a lively, fertile mind full of ingenuity, imagination and creativity, but it all depends on nurture.

When the appropriate environment exists, the individual citizen meets the challenge of laying the
golden eggs everyday; when it is absent the eggs dry up! The chaos, injustice, corruption, favouritism, tribalism, immorality and deprivation in our society are the causes of the sickness that is weighing down Camair. Camair is a mirror that reflects the nakedness of the New Deal regime.