S.Africa’s finance minister needs funding for troubled airline SAA

South Africa’s Finance Minister Tito Mboweni said on Thursday that the government was still trying to find additional financing for troubled state airline South Africa Airways (SAA).

Mboweni was speaking at a meeting with business leaders in Johannesburg to discuss what message they will take to the World Economic Forum in Davos this year.

“National Treasury has provided financial support (to SAA) to the best of our abilities,” he told the delegates.
“As of yesterday when I was speaking to the director-general of National Treasury we were still trying to find additional financing for SAA. … Let’s keep our fingers crossed.”

State-owned SAA entered a business rescue — a form of bankruptcy protection — last month in an effort to rescue the company and around 10,000 related jobs.

It was promised 2 billion rand ($138.77 million) from the government and another 2 billion rand from lenders in order to make that happen.
The national carrier is one of several state entities struggling under mountains of debt after nearly a decade of mismanagement, including state power company Eskom.

Without that promised cash, SAA could very quickly become insolvent. On Wednesday the business rescue practicioners — Les Matuson and Siviwe Dongwana — said they were “hopeful that a mechanism can be found to unlock the liquidity constraints.”

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