President of South Africa Cyril Ramaphosa has said that South Africa Airways which is restructured should be independent enough to foot it’s bills and generate internal revenue.
In a report by South African online news Fin24.com the President said
“In the interests of South Africa’s aviation industry and our economy, it is essential that a future restructured airline is commercially and operationally sustainable and not dependent on further government funding,” he said during his State of the Nation Address on Thursday.
A restructured SAA cannot rely on government for further funding, President Cyril Ramaphosa has said.
“In the interests of South Africa’s aviation industry and our economy, it is essential that a future restructured airline is commercially and operationally sustainable and not dependent on further government funding,” he said during his State of the Nation Address on Thursday.
He added that the “extent of capture, corruption and mismanagement in SOEs is best demonstrated at South Africans Airways, which was placed in business rescue late last year”.
SAA was placed under voluntary business rescue in early December following years of losses and billions of rands in state bailouts.
The practitioners, Siviwe Dongwana and Les Matuson, announced the cancellation of all of the airline’s domestic routes apart from the popular Johannesburg-Cape Town flight early in February. A number of international and regional routes were also cut. They practitioners said the cuts were aimed at supporting SAA’s transformation into a sustainable and profitable business, and were required to conserve cash.
The practitioners defended the route cancellations in the wake of Ramaphosa’s remarks.
In the meantime, a Johannesburg High Court in a ruling ruled last week Thursday insisted that SA Express which is a state-owned airline and different from SAA should be placed under business rescue. This ruling however did not go down well with SA Express as they intend to file an appeal against the ruling.
by Francis Ogwo
Source: fin24.com
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