The Kenyan government has approved $350 million to finance its national airline, aiming to return grounded aircrafts to service and meet urgent financial obligations.
Late Monday, the cabinet announced in a statement that the funding will be released on installment basis under the supervision of Kenya’s National Treasury, with the repayment arranged for up to 10 years.
Kenya Airways reported a first-half pre-tax loss of approximately $123 million in 2026. It also said fuel costs rose 72 percent, accounting for as much as half of its total costs, as the Middle East conflict disrupted fuel markets and delayed maintenance services and spare-parts deliveries.
The latest financing therefore addresses a problem that extends beyond debt.
Aircraft awaiting maintenance cannot carry paying passengers, while the airline continues to face financing, staffing and other operating costs.
Alongside the new financing, the cabinet endorsed a proposal to convert existing government loans into an equity-qualifying tradable instrument.
That proposal concerns debt already owed by the airline and would not provide another $941 million in cash.
According to The Star’s account of the Cabinet statement, the interventions are intended to safeguard a carrier the government says contributes more than $1.3 billion annually to Kenya’s economy through tourism, trade and regional connectivity.
The measures still require the relevant corporate, shareholder and regulatory approvals.
The rescue follows a difficult period in which maintenance delays and shortages of spare parts have constrained the airline’s capacity despite passenger demand.
MG/as/APA