DPE confident restructured SAA will be financially viable, self-sustained
More than R10 billion is needed to get the airline off the ground after the business rescue plan was approved, but there is no word on where the funding will come from.
JOHANNESBURG – The Department of Public Enterprises said that it was confident that a restructured South African Airways (SAA) would be financially viable and self-sustainable.
SAA has depended on government bailouts for over a decade, costing the national fiscus tens of billions in bailouts.
But government said that things would be different as the new restructured airline would not need Treasury to sustain it.
The business rescue practitioners said that more than R10 billion would be needed to get the airline off the ground.
The approved business rescue plan is thin on whether government has committed funding to the restructuring of the new SAA.
National Treasury is already stretched thin with money redirected at fighting COVID-19 pandemic.
In his supplementary budget last month, Finance Minister Tito Mboweni didn’t allocate any new money to SAA.
The Public Enterprises Department said that it was confident that a national carrier would also be financed with an equity partner.
There have been no details on possible investors, but government said they would be announced soon.