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Ramaphosa: 'We Can't Give Up On SAA'

Answering questions at a National Council of Provinces sitting, Ramaphosa said government is hopeful that the embattled airline will one day be profitable.

01/11/2017 17:08 SAST | Updated 01/11/2017 17:09 SAST
Siphiwe Sibeko / Reuters

Deputy President Cyril Ramaphosa says government has to do everything it can to revitalise South African Airways.

Answering questions at a National Council of Provinces sitting on Wednesday, Ramaphosa said government is hopeful that the embattled airline will one day be profitable.

"As we all know, SAA was not able to settle this debt because of the dire financial situation it has been facing. It became clear that failure to settle the debt would have resulted in SAA defaulting on its R1.8-billion debt to City Bank, [which] would have resulted in cross defaults on SAA's other guaranteed debts of R11.9-billion," he said.

"There have been protracted deliberations within government on how we should recapitalise SAA."

He said a plan to revitalise the airline is now in place.

"The remedial actions that have had to be taken are now underway... A clear plan to revitalise SAA is in place, and I would say we should give that an opportunity... SAA is a state-owned enterprise; there's no running away from that," he said.

"Because it is a SOE, we have to do everything we can to revitalise it. We have not decided to sell off SAA. We are all hopeful that it can [be profitable]."

Earlier this year, finance boss Malusi Gigaba authorised an additional R4.8-billion bailout from government to stabilise the airline, bringing the total amount of monies it received from government this financial year to R10-billion.

A new board has since been put in place at SAA.