South Africa cuts funding to state airline

The South African government has refused a request by South African Airways (SAA) for $500m worth of emergency funding.

In a leaked letter to the firm’s administrators, Public Enterprises Minister Pravin Gordhan said that “government is unable to provide additional funding to sustain the business rescue process beyond the funding that has already been provided to the airline in the form of post-commencement finance”. 

The minister added that the coronavirus pandemic had “further stretched national resources”, leaving the government unable to bail out SAA.

The state-owned airline now faces liquidation, with the likely loss of 5,000 jobs. 

The airline has not been profitable since 2011 and has received over $1bn worth of state bailouts over the past three years. 

Owing to the coronavirus pandemic, it was forced to ground most domestic and international flights last month. 

SAA say they will continue to operate repatriation flights for stranded foreign nationals as the airline attempts to “asses the impact” of the government’s decision.

Photo: Getty Images