» Home » Business News Iraq Directory Services Plans Subscription Contact us Site Map Help About Iraq Iraqi Airways rebuilds despite violence Jordan July 20, 2005 Iraqi Airways plans to lease eight planes shortly to meet growing demand, despite concerns about security at Baghdad airport, Transport Minister Salam al-Malaki said on Wednesday. The once formidable flag carrier, whose fleet was obliterated by wars and U.N. sanctions, will inaugurate regular flights in the next few days between Baghdad and Dubai and between Amman and Suleimaniya in northern Iraq, Malaki said. "Iraqi Airways is making a comeback. We have a broad plan to lease cargo and passenger planes," Malaki told Reuters. "We are also finalising permits and routes to Tehran, Istanbul and Cairo," said Malaki, who was in Jordan to attend an international donor conference for Iraq. The Iraqi carrier started regular flights to Amman and Damascus earlier this year. Other companies flying to Baghdad include Royal Jordanian, which has two to three round trips a day, and private operators in the Gulf. "We welcome competition from the private sector although our priority is to rebuild Iraqi Airways," Malaki said. Insurance costs typically reach $100 per passenger because of instability and the situation at Baghdad airport, whose perimeter gates have been targeted in suicide attacks. Mortar rounds frequently hit the airport grounds. Foreign carriers, such as Royal Jordanian, do not keep their planes overnight in Baghdad. But demand for flights remains strong from Iraqi government workers sent for training abroad, people fleeing the country or sending their families away, businessmen and foreign contractors, airline executives say. HEAVY CLAIMS Iraqi Airways started rebuilding its fleet after the 2003 U.S.-led invasion that removed Saddam Hussein and his Baath Party from power. The war and post-war looting destroyed what survived of the fleet and much of the company's assets, such as hangers and sales offices across Iraq. The company bought a 1983 Boeing 737 last year for $3.8 million and leased another plane of the same type from the Iraqi al-Khawam family, which had business ties with Saddam's government and has offices in Jordan. Iraqi Airways recently leased an additional Boeing 727 and Boeing 767. Malaki said the airline could lease more planes from the Khawams, who own Amman-based private airline company Teba. U.S.-led occupation officials had advised against resurrecting the company as it has millions of dollars in debt and a $450 million international lawsuit from Kuwait hanging over it, dating back to Iraq's 1990 invasion of Kuwait. Malaki was confident the problem would be resolved: "Our Kuwaiti brothers have expressed readiness to close this file." One option being considered is to channel part of Iraqi Airways revenue to Kuwait and for the Iraqi government to agree to pay compensation, Malaki said. Iraqi Airways also faces financial claims from Jordan and Tunis, where its planes were sent to escape U.S. bombing just before the 1991 Gulf War. The planes have been sitting in Jordanian and Tunisian airports since. Before the Gulf War, Iraqi Airways signed a contract with Airbus, co-owned by European aerospace company EADS and Britain's BAE Systems, to buy around five A310s. Iraq paid a $12 million to $15 million deposit to Airbus. Malaki will lead an Iraqi delegation to France in mid-August to discuss the unfulfilled contract. "We will talk about ways to revive it and recommend a solution to the cabinet," Malaki said. "Other manufacturers have been approaching us," he said. "We are keen to cooperate with them also and use their expertise to support Iraqi Airways." Source: Reuters © 2002-2004 Iraq Directory - All Rights Reserved