South African Airways has yet to receive the R2-billion bailout it was promised by the government last year and is growing desperate as another payment deadline approaches.
Speaking to Rapport, National Treasury confirmed that SAA had not received the money it was promised and did not state when the bailout would be paid to the state-owned airline.
“The R2 billion in working capital will be financed in consultation with the department of public works and the business rescue practitioner,” Treasury said.
“More details will be made available at a later stage.”
The situation at SAA is growing increasingly worse, with the airline’s business rescue practitioner stating that it may not be able to pay this month’s salaries.
SAA was placed into urgent business rescue last month, and Rapport stated the airline’s business rescue plan is expected to be finalised before 14 February.
Liquidation would be a mistake – Gordhan
Public enterprises minister Pravin Gordhan previously stated that the liquidation of SAA would be a disaster, as it would have led to the immediate grounding of the airline.
“Operations would have ceased. Passengers all over the world, already at airports, would have been left stranded. The costs of their repatriation would have been enormous,” explained Gordhan.
“The same would have happened at domestic and regional airports. Passengers already at the destination of their first leg would not have been able to return to their origins in an orderly manner. It would have cost us dearly in terms of future tourist and business revenue.”
He said that this would have significant ramifications for the South African airline industry as a whole, adding that business rescue is the best chance of transforming the airline into a stronger company.
“Business rescue will allow the airline to operate in an orderly manner. It keeps SAA’s planes and passengers flying. It also protects as many jobs as possible and the interests of the airline’s lenders,” Gordhan said.