Govt okays Sh45.4bn financing for Kenya Airways

The Cabinet has endorsed $350 million (approximately Ksh45.4 billion) in shareholder financing for Kenya Airways, aimed at addressing the national carrier's maintenance needs, bringing grounded planes back into service and bolstering its financial health. The decision was made public on October 9, 2026, as part of the government's strategy to aid the airline's recovery amidst escalating financial and operational challenges.

According to the Cabinet communication, the funds will be disbursed in portions under the supervision of the National Treasury, with a repayment horizon of up to ten years. The approval is a response to Kenya Airways' persistent financial struggles, including soaring costs, aircraft availability issues and substantial net losses.

For instance, in the six months leading up to June 2026, the airline reported a net loss of Ksh16.08 billion, up from Ksh12.15 billion in the same period a year prior. This loss increase, by around 32 per cent, occurred despite a rise in revenue, with total income soaring to Ksh81.25 billion, a hike from Ksh74.5 billion the previous year.

The surge in costs was primarily due to escalating fuel and maintenance expenses, adding to the pressure on the airline's financial standing. The recent funding is expected to assist Kenya Airways in meeting urgent commitments as it endeavors to enhance operational reliability and reestablish sustainable financial performance. The airline is striving to restore flight capacity as it grapples with rising operational expenses and financial losses.

As of September 2026, three aircraft were undergoing extensive servicing due to their age, having clocked 12 years in operation. The Cabinet has prioritized aircraft maintenance and returning grounded planes to service as critical areas of focus for the new capital. While specific dates for the grounded aircraft's return have not been disclosed, the funding is primarily directed towards these critical areas.

Kenya Airways has made strides in rebuilding its fleet. For example, one of its Boeing 787-8 Dreamliners returned to service in July, and a leased Boeing 777-300ER, previously operated by Turkish Airlines, also resumed commercial operations on the Nairobi-London Heathrow route on July 17, adding to the airline's passenger and cargo capabilities.

The fleet recovery is crucial as aircraft shortages have constrained the airline's ability to meet demand and generate revenue. In its 2025 financial results, Kenya Airways' Chief Financial Officer, Mary Mwenga, disclosed that the airline operated at around 80 per cent of its available capacity during the year, a situation that still improved it from 2019, when the airline recorded Ksh128 billion in revenue while functioning at full capacity.