Kenya Airways said on Thursday the completion of a new terminal at the country's main airport will significantly improve its operation efficiency and ease the congestion that the airline has been facing at its Nairobi hub.

The airline's CEO Dr. Titus Naikuni told a shareholders meeting in Nairobi that the completion of Jomo Kenyatta International Airport's Terminal Four will increase efficiency and create more room to accommodate a larger fleet that will allow the airline to compete more aggressively and profitably as the African airline industry continues to attract more regional and global competitors.

"By the fourth quarter of the next financial year, an additional capacity to handle up to two and a half million more passengers would be added at the airport, but this is not enough," he said.

The development comes after the Cabinet deliberated on the development of the Greenfield Terminal at Jomo Kenyatta International Airport and approved that its implementation proceeds with the involvement of all stakeholders.

The Cabinet meeting of Sept.13 noted that the project should be fast-tracked since it was a priority Vision 2030 Flagship Project. The project will also ensure that Kenya maintains its competitive edge as the regional transport hub.

"In addition to this, more parking for vehicles and aircraft would be available," Naikuni told the shareholders at their 36th Annual General Meeting (AGM).

Officials says Jomo Kenyatta Airport is in a good geographical position and Kenya Airways through its 10-year Growth Plan is taking advantage of this position to take advantage of the surge in East to West traffic, driven by new investments and increased disposal income in Asian countries.

Kenya Airways currently flies to 58 destinations, 46 of them being to African destinations. However, through the SkyTeam Alliance, the carrier takes passengers to over 926 destinations in 173 countries and 490 lounges globally.

Naikuni also outlined a number of initiatives the management has embarked on to manage costs as the airline continues its expansion program which will increase the number of aircraft in the fleet from 34 in 2012 to 115 in the next nine years.

In the last financial year, he said, high operating costs eroded the effect of a 24 percent growth in revenue by national carrier.

Among the costs that shot up during the year was labor and fuel that went up by 19.6 percent and 64 percent respectively, as well as landing fees that grew by 35 percent.

"We see light at the end of the tunnel. We believe that the more we control our costs, the more will continue being profitable, " Naikuni said.

"Kenya Airway's case is not isolated since a similar trend is occurring among other leading airlines globally," Naikuni said in reference to the recent retrenchment of some 578 employees at the just ended staff rationalization exercise.

The drastic action is expected to reduce the wage bill of the airline by at least 12 million US dollars annually. Some of initiatives to bring down the airline's costs include investing in aircraft that consumes 20 percent less fuel.

Naikuni said the airline is also hiring local staff for some of its destinations to cut down the cost of putting up the crews in expensive hotels. In other areas, the airline intends to use technology and outsource its services to firms that can provide the same service at a lower cost.

"We invested in IT to be efficient and meet global standards. We are a global airline and must be able to compete globally," Naikuni said.

"The structuring meant to create efficiency in our processes and the criteria used was performance of individuals and assessment of the ability of the skills to compete effectively in the future," he added.