Time for govt to seriously consider private SAA shareholders – economist
An economist believes the time has come for the government to seriously consider getting private investors board to try and save the ailing South African Airways (SAA).
On Thursday, the airline announced that it will be scrapping all its domestic flights except the Johannesburg and Cape Town route.
Debt-ridden and strapped for cash, SAA was placed under a state-approved rescue plan in December following a week-long strike that pushed it to the verge of collapse.
Economist Mackson Tshehla says private shareholders is one way to try and save the airline.
“If we are to have a private shareholder who can own up to 45% and government will still have the bigger ownership of the entity, with the appointment of business rescue practitioners, it is a one of those conclusion that we might have a private shareholder.
“The chopping of board and management on finances has been poor in making the entity sustainable.”
The SAA business rescue practitioners has already warned that job cuts at the airline were inevitable and Tshehla says will just add to the country’s massive unemployment rate.
“The unemployment rate is not looking good and these kind of decisions (retrenchment) will worsen the situation.”
The National Union of Metalworkers of South Africa (Numsa) and the South African Cabin Crew Association (SACCA) have already expressed their dismay at reports that more than 900 SAA would could lose their jobs.