FINQUES­TION OF THE WEEK

Should the South African Gov­ern­ment con­tinue to bank- roll ail­ing na­tional car­rier, South African Air­ways?

Finweek English Edition - - Openers -

IN ANY com­mer­cial sense, SAA would prob­a­bly have been sent to the wall long ago. How­ever, Gov­ern­ment re­gards it as a strate­gic as­set and con­tin­ues to pro­tect it. This trans­forms any po­si­tion to sup­port it or not from be­ing one of pure pos­i­tive eco­nomics to one of pure po­lit­i­cal choice.

TONY TWINE Econometrix econ­o­mist

SAA man­age­ment has no real in­cen­tive to re­solve SAA’s op­er­at­ing prob­lems if it knows the State will al­ways bail them out. State sub­si­dies also rep­re­sent a du­bi­ous in­vest­ment for SA tax­pay­ers, who re­ceive a poor re­turn on their in­vest­ment in terms of im­proved ser­vice, ef­fi­ciency or fi­nan­cial health of the na­tional air­line.”

PAUL ZILLE Avi­a­tion ex­pert

WE are now grown up enough as an econ­omy to rely more on private-sec­tor air­lines such as Co­mair and 1Time. One would love to see more of an open-skies pol­icy rather than spend­ing R4bn to save one com­pany. The R4bn could be bet­ter spent on cre­at­ing more jobs.

MIKE SCHÜSSLER T-Sec econ­o­mist

THE air­line busi­ness is an ex­cep­tion­ally dif­fi­cult in­dus­try. Across the world many in­ter­na­tional air­lines have there­fore re­ceived cap­i­tal in­jec­tions to re­cap­i­talise and re­struc­ture their busi­nesses. In­deed, there are prob­a­bly very few air­lines in the world that

other.” have not re­ceived state sup­port at some stage or

LITHA MCWABENI Act­ing di­rec­tor­gen­eral, De­part­ment of Pub­lic En­ter­prises

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