By: Boy Fidel Leon
Despite its history of financial losses, Uganda Airlines retains strong potential to become a profitable national asset if strategic reforms are implemented, according to a report by Parliament’s Public Accounts Committee on Commissions, Statutory Authorities and State Enterprises (PAC-COSASE).
The committee presented findings from the 2023/2024 Auditor General’s report during Thursday’s plenary, chaired by Speaker Anita Among. The report showed the airline posted a net loss of Shs237.9 billion in 2023/2024. Yet revenues grew sharply: passenger revenue rose by 58 percent, cargo by 55 percent, and excess baggage by 63 percent.
These statistics show a clear demand for Uganda Airlines’ services. What is missing is operational efficiency and targeted investment to convert these figures into profits,” said Hon. Medard Lubega Sseggona, COSASE chairperson.
Since its revival, the government has injected Shs1.87 trillion into the airline, with cumulative losses now totalling Shs1.02 trillion. PAC stressed that with prudent management, the carrier could evolve from a liability into a strategic national asset.
PAC highlighted Uganda Airlines’ advantage as the country’s flagship carrier, connecting Uganda to key African and international destinations. The committee singled out plans to launch routes to Johannesburg, Riyadh, and Accra, (delayed only by budgetary constraints) as priority investment areas.
The aviation industry is highly competitive but equally lucrative when managed strategically. If Uganda Airlines builds alliances with established global carriers, invests in marketing, and adopts modern fleet management through leasing, it can become East Africa’s premier hub airline,” the report stated.
The committee also pointed to the growing potential of the airline’s cargo operations. With Uganda’s expanding exports of fresh produce, fish, and manufactured goods, cargo income rose by over 50 percent in 2024 despite logistical bottlenecks and a limited fleet.
PAC warned that governance gaps could undermine investor confidence. The committee noted instances of awarding General Sales Agent (GSA) contracts without bank guarantees and Shs11.9 billion in contingent liabilities from lawsuits and lost-baggage claims.
These vulnerabilities weaken investor trust. Uganda Airlines must strengthen accountability in contracting and staff conduct to establish a reliable platform for growth,” the report said.
The committee urged the airline to reassess its business model, prioritising aircraft leasing over outright purchases and pursuing code-sharing agreements with established carriers.
It recommended targeted funding for profitable routes and cargo services, as well as investment in digital ticketing and customer service platforms. PAC also encouraged positioning Entebbe International Airport as a regional hub.
Uganda Airlines was originally founded in 1977 but ceased operations in 2001 due to financial difficulties and management challenges. Its revival in 2019 marked a strategic effort to restore Uganda’s presence in the regional and international aviation market.
Since relaunch, the airline has aimed to serve as the country’s flagship carrier, connecting Entebbe International Airport to key African and global destinations. While the early years have been challenging, the airline’s revival has positioned it as a critical player in national transportation and trade networks.
PAC stressed that Uganda Airlines remains a valuable national asset, offering more than transport services. A strategically managed airline strengthens Uganda’s connectivity, supports tourism, facilitates trade, and reinforces national identity on the regional and global stage.
By focusing on profitable routes, leveraging code-sharing agreements, and expanding cargo operations, the airline could evolve into East Africa’s premier hub carrier. PAC argued that with disciplined management, investor confidence, and careful allocation of resources, Uganda Airlines’ potential far outweighs its history of financial losses, positioning it as a cornerstone of national economic strategy.
The report concluded that despite its challenges, Uganda Airlines remains a viable entity with the potential to transform into a strategic national asset, provided management, oversight, and targeted investment are applied.