SAA is not too big to fail, says Pravin Gordhan

Public enterprises minister Pravin Gordhan. Picture: TREVOR SAMSON

“If some tough decisions need to be made, we’ll make them,” public enterprises minister Pravin Gordhan said in a speech at a conference in New York on Thursday. SAA is “not too big to fail.” The government will repay loss-making SAA’s outstanding government-guaranteed debt of R9.2bn over the next three years, the National Treasury said in the medium-term budget policy statement in October. Lenders are demanding a firm repayment plan as a condition for agreeing to extend more funding, SAA has said.

The state is talking with potential investors in the airline to ease the continuing burden the company puts on the national budget. “I am pleased to learn that there are conversations involving South African Airways and potential equity partners, which would liberate the fiscus from this SAA sword of Damocles,” finance minister Tito Mboweni said in October.

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