Following several attempts to salvage its 86 year old national carrier, South African Airlines, the South African government has initiated the recreation of a new national carrier from scratch, due to recurring issues of mismanagement, bankruptcy, and liquidation of SAA.
It would be recalled that, a few weeks ago, Ventures Africa hinted on the possible closure of the airline, when the government declined a request of $531 million by the administrators of SAA to recuperate the business affairs.
For over a decade, the 2nd largest airline in Africa has not recorded any profit or gain in its financial book.
Even worse is the fact that a turnaround strategy, which was created in December 2019, by President Cyril Ramaphosa’s administration, in the hopes of reinforcing the airline market share, was not realized due to the ongoing coronavirus pandemic.
Since, the widespread of coronavirus around the world, The airline has been largely affected by travel restrictions and closed borders in the aviation industry. Another issue disrupting its operations is the 5 week shutdown adopted by South Africa in March 2020.
The minister of public enterprise, Pravin Gordhan believes that the creation of a new airline will create an opportunity to compete amongst aviation transporters in the post-COVID-19 world.
The parastatal further disclosed that the airline will merge both public and private participation.
Logically, the airline holds an appealing proposition in the hearts of South Africans from its 86 years of existence, nevertheless, the idea of starting a new national carrier comes with an advantage for the government as it will no longer account for the majority of financial troubles, poor management, and high debt.
Fortunately, Roger Foster, CEO of Airlink, disclosed that the privately-run regional airline is open to partner with the government in a public-private partnership on the birth of a new airway so far both parties are in accord.
He also emphasized on building a merger that would involve commercial principles, proper governance, and no political interference.
Fin24, a news agency reported on May 06, 2020, that the Finance Minister Tito Mboweni hinted that the fall of Swiss Air (National carrier of Switzerland) and its recovery will be a business model, which the government will study thoroughly.
