The National Treasury and the Department of Public Enterprises are reportedly in discussions about bailing out struggling local carrier, South African Airways.
The amount is yet to be confirmed but is expected to be much bigger than the guarantees that have been given to the carrier in previous years.
“If we want to migrate SAA to financial sustainability, we need to give it necessary support. If we continue giving it piecemeal, we will continue to have the recurring problem we’ve had for the past 10 years,” Public Enterprises Minister Malusi Gigaba’s spokesperson Mayihlome Tshwete was quoted as saying by the Business Report.
“We all need to acknowledge that it is a South African asset and, therefore, the state needs to support it.
“People who politicise SAA deliberately ignore certain facts, facts like it is the lowest capitalised airline in the world. We are not having an honest discussion about SAA.”
Last year, the carrier presented a long-term turnaround strategy to Minister Gigaba, with one of its aims being to procure a fleet of fuel-efficient airplanes. The carrier, however, has shelved its plans to buy the 23 fuel-efficient, wide-body planes as its contract did not have the required industrialisation and localisation elements it needed for the state tender.