SAA’s role is priceless – minister

It is in the national interest for South Africa “to have influence over our connectivity to all parts of the world”, rather than to rely exclusively on the profit-driven scheduling of global airlines, Finance Minister Malusi Gigaba told parliament yesterday.

Tabling his medium-term budget policy statement (MTBPS), he added: “SAA sells South Africa’s economy, tourism and culture to every one of its pas- sengers. Global airlines do not, and will not, perform this priceless marketing and branding role.”"

He said SAA now had a capable board that will lead it back to sustainable operations. After meeting the new SAA board, government would announce plans to consolidate aviation assets and bring in an equity partner.

“We believe a strategic partner can play an important role in SAA’s turnaround, as well as unlocking value for the fiscus which has invested significantly in the airline over the years.”

Government recently gave SAA R5.2 billion to pay for maturing debt and operations and will top it up to R10 billion by March 31.

The MTBPS warned: “There is risk that if SAA’s financial fortunes do not improve, there will be further calls on the remaining guarantee.” It amounts to R15 billion. In his speech, Gigaba said state-owned entities have become a major fiscal risk due to government guarantees of their debt. National Treasury would make proposals to government to tighten up its government guarantee framework.