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7       Africa telegraph         25 October - 09 November 2020

              The future of South African Airways is                                                                          South Africa News

                          still hanging in the balance



                                                                                                                  By  Ilhan Omar
           Bloemfontein, South Africa - The pre-
           carious situation affecting the South Af-
           rican airline still lingers on, after state
           bailouts  and debt guarantees  from the
           government for several years.
           The  loss-making  South African Airways
           (SAA) appears doomed unless the cash-
           strapped  government  can  find  more
           money to save the carrier.

           Last year, the embattled  state airline
           went into administration and was res-
           cued by  the government.  That  was not
           the first time. SAA has survived on state
           bailouts  and debt guarantees  from the
           government for several years. Its hopes
           of a return to profitability through admin-
           istration took a serious blow when coro-
           navirus brought the global travel and
           tourism industry to a stand-still.

           At a time when some of the world’s most
           profitable  and  best-run  carriers  find
           themselves in a precarious situation, the
           fate of SAA which grounded all its aircraft           Financial storm looms on the horizon for the troubled South African Airline
           in March seems to be hanging in the bal-
           ance.                                 ship, but only if SAA makes a fresh start.  lion, according  to the International  Air   “This work will take a while to realise, but
                                                                                       Transport Association.                 we hope to be able to announce who that
           Last year, before SAA was placed into   “SAA has a lot of legacy issues such as                                    strategic partner will be before the end of
           business  rescue – a process of inde-  debt,” Ethiopian chief executive,  Tewol-  Kgathatso Tlhakudi, Director General of   this year.”
           pendent  administration to revive ailing   de GebreMariam, told the South  Afri-  the Public Enterprise  Department, un-
           businesses  if possible, or shut them   can state broadcaster SABC earlier this   der which SAA falls, last week said the   Despite the logical arguments to keep the
           down, the airline had around 40, mostly   month. It owes almost 13 Billion Rand   government is looking for a partner to re-  airline afloat, it remains unclear where the
           newer Airbus aircraft.  As a result of the   (£800 million), mostly in local bond is-  launch the airline.         government  will  get the required funds
           administration, it handed back the leases   sues.                                                                  to do so.  The treasury has predicted  a
           and kept just nine that it owned outright.                                  “We need a strategic partner for  the   300bn rand shortfall in tax revenue this
                                                 Before the pandemic, Ethiopian  Airline   clean-up [of the] airline, with a new bal-  year, as the country’s economy struggles
           Ethiopian Airlines, Africa’s  aviation  suc-  carried more than 13 million passengers   ance sheet,” he said.      to bounce back from the devastating im-
           cess story, has offered a sort of partner-  annually, while SAA moved only 4.5 mil-                                pact of the COVID-19 pandemic.
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