AIRLINES IN PNG FACING BANKRUPTCY SAYS MARU

PapuaNewGuinea’snationalcarrierAirNiugini, PNGAir,andotherthird-levelairlinesmaybefacing bankruptcyinthenext12months,People’sNational CongressdeputyleaderRichardMaruhaswarned. “Thiswillhappenunlesstherearesignicantcostcuttingmeasures,includingthegovernmentgoingto theirrescue,”hesaid.

MrMarusaidtheMinisterforPublicEnterprisesand StateInvestmentsSasindranMuthuvelproposedon June12thatthegovernmentshouldprovidearelief packageofK300millionforAirNiuginibecausethe airlinewas“currentlyfacingliquidityissuesandisin direneedformorecapitalinjectionandsupportto mitigatetheeconomicslowdown”.

“Alarmingly,atthiscriticaltimewhenAirNiugini desperatelyneedsaK300millionbailout,the governmentappearstobefacilitatingadealforAir NiuginitobuyoutNasfund’ssharesinPNGAir,”Mr

Maru said.“ThisisatatimewhenPNGAirisaboutto gobankrupt;AirNiuginiwilllikelytakeoverexisting routesanyway.”Hesaidtoanyindependentobserver, theproposedtransactionwouldappearsuspicious, makesnobusinesssenseandcanbeperceivedasa corruptdealbypeoplewithvestedcorporateinterests.

MrMarusaidconcernsarebeingraisedasto whetherthereisanyvalidityinclaimsofconict-ofinterestfordecisionmakersatAirNiuginiinrelationto theirprivatebusinessinterestsaswellaspartnerships withNasfund.

“Thequestionmustbeasked–whyisthispurchase justforsharesheldbyNasfund,andnotshares heldbyotherinvestorssuchasMRDCandprivate shareholders?.JamesMarapemustexplainwhere thegovernment,onbehalfofAirNiugini,isgettingthe moneytobuyoutNasfund’sinterestinPNGAir.

“ThisisparticularlyimportantatatimewhenAir Niuginiitselfcango‘bellyup’ifthegovernmentdoes notcometoitsrescuewiththeK300m (FJ$188m) thatitneeds.The

PNG Post - Courier