Namibia’s minister of public enterprises Leon Jooste has defended the government’s decision to pay N$1.6 billion to an American firm that leased aircraft to Air Namibia.
Jooste said this in a statement confirming that the payment was made on July 30.
The national airline was forced to return the aircraft it was leasing after the government shut it down in 2020.
Air Namibia’s fleet included the two leased Airbus A330-200 aircraft, two Airbus A319-100 planes, and four Embraer ERJ 135s.
Air Namibia’s winding up meant the government had to pay a termination fee for opting out of the contract four years earlier.
Jooste’s ministry was tasked with negotiating with American aircraft lessor Castlelake which had a contract with Air Namibia up to October 2025.
“The total negotiated settlement is, therefore, N$1.6 billion,” he said, adding that this is less than they initially planned to spend and thus saved up to N$667 million.
The government has been criticised for paying billions to a private company while it was in financial predicaments.
Jooste said the government resorted to a four-month “negotiation window” from November 2020 to February 2021 where Castlelake agreed to waive monthly rentals resulting in savings.
The closure of the national airline affected more than 600 workers. There are also concerns that the liquidation process could take as long as five years. Jooste is one of the high-ranking government officials accused of pushing for the airline’s closure.