By Paul Vecchiatto and John Bowker
(Bloomberg) – South Africa resisted adding yet more billions of rand to its ongoing bailout of the country’s bankrupt national airline, sticking to the idea that a private partner can be brought in to salvage the carrier.
Administrators for South African Airways have asked for R3.5bn ($239m) more in state funding than was allocated in October, according to the country’s Budget Review presented on Wednesday. A further R5.3bn is being sought from outside entities, according to the document.
Private saviour
Even healthy carriers are expected to struggle for a second consecutive year, with industry body IATA reporting Wednesday the industry could burn through $95bn in 2021 – double the previous forecast. The identification of a new coronavirus variant in South Africa has seen the country placed on many travel blacklists, further limiting SAA’s revival hopes.
South Africa’s government has pinned its hopes on the emergence of a private-sector saviour, with Public Enterprises Minister Pravin Gordhan saying this month there are three potential candidates and one will be selected in about a month.
The ruling African National Congress is “open to suggestions of a private-equity partner in SAA and that government need not even hold a majority stake,” Paul Mashatile, the party’s Treasurer General, said in an interview. “I am not wedded to the notion of a state-owned airline.”
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