S.Africa gives national airline $98 mln, but administrators can’t use it

THE South African government has transferred 1.5 billion rands ($98 million) to administrators for national airline South African Airways (SAA) but the funds cannot be used yet, the administrators said.

The administrators said the conditions the Department of Public Enterprises (DPE) attached to how the money should be spent were in contravention of labour and companies laws.

“We are unable to utilise the funds until the conditions have been amended by the DPE,” they added in a statement.

A DPE spokesman said the department would comment later.

SAA entered a local form of bankruptcy protection in December last year after roughly a decade of financial losses, and its fortunes worsened after it grounded flights because of the COVID-19 pandemic.

It halted all operations at the end of September when funds ran low.

The government awarded SAA a 10.5 billion rand bailout in October’s mid-term budget, but funds from that bailout were not expected to flow until mid-January.

SAA is one of a handful of struggling state firms that have placed huge strain on the public finances of Africa’s most industrialised economy over many years.

 

 

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