'I believe SAA is going to be turned around'

Malusi Gigaba suggests that this will soon end with the appointment of the new CEO Vuyani Jarana.

FILE: Minister of Finance Malusi Gigaba. Picture: Thomas Holder/EWN

JOHANNESBURG - Finance Minister Malusi Gigaba says problems at South African Airways (SAA) were mostly due to the way it was run.

Gigaba suggests that this will soon end with the appointment of the new CEO Vuyani Jarana.

SAA has had five CEO's from 2013, which Gigaba says hampered the implementation of a turn around tragedy at the airline.

Government has already approved a R2 billion bailout to SAA.

Gigaba says the airline must be properly run to make good use of the bailout.

“I believe SAA, with the new CEO, executive management and the new turnaround strategy that’s been suggested, is going to be turned around and focused on the task of the mandate the shareholder is setting for it.”

Finance ministry spokesperson Mayihlome Tshwete said: “We still have a number of areas of focus that we need to work on. We are strengthened by having a CEO who’s going to be at the forefront of making sure that the company is turned around.”

Democratic Alliance Member of Parliament Alf Lees has welcomed Jarana’s appointment, saying he has an impressive record in business.

But he says SAA poses challenges much bigger than those Jarana has faced to date, with its first quarter results showing losses of R1,5 billion.

“If it were a private company, it would either be in liquidation or very close to that.”

SAA also has around R6,7 billion in loans that become due for repayment in September.