Kigali (Reuters) - Rwanda expects to have a new airport by 2014 and has set aside $98 million as capital for its national airline over the next three years with a view to then selling it off once it breaks even.

Finance Minister John Rwangombwa told Reuters in a recent interview that RwandAir was expected to break even in 2013.

He said the airline was pivotal to the new airport to be located at Bugesera. The airport is estimated to cost $350 million.

"Around 90 percent of the engineering design works are complete and by the end of September we shall be attracting investors through private-public partnership. We expect it to be finished by 2014,” Rwangombwa said.

He said the government had spent some $84 million to buy two aircraft from Deutsche Lufthansa after getting a $40 million loan from the Eastern and Southern African Trade and Development Bank (PTA) earlier.

RwandAir has also acquired two Bombardier CRJ200 craft for $14 million and expects two Boeing 737 aircraft, due for delivery in 2011.

"We are spending about $400,000 a month on leasing alone,” Rwangombwa said. "We believe that RwandAir will provide the required linkage to the building of Bugesera airport as it will increase receipts from high value exports. Once the company is viable we can then go on with the privatisation process,” he added.

RwandAir’s chief executive Rene Janata told Reuters that the airline was at start-up phase and was not expected to make a profit overnight.

"Our business plan projects break-even in the year three to four and profitability in year five to six. This means it will be making huge capital investment in terms of equipment, manpower and systems to bring the airline to the next level,” he said.

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