SIFISO SKENJANA: Government should explore sectors that offer value to ailing SAA
The state should consider operational risk transfer mechanisms that would make the carrier interesting to local investors
Finance minister Tito Mboweni recently alluded to the possibility that he has lost the SAA funding battle when he tweeted that “in politics one loses some battles if you are a team player”. This after the department of public enterprises announced that public funds had been earmarked to shore up the ailing state-owned airline, all to be revealed in the October midterm budget policy speech.
If the Treasury is going to have to see to SAA’s funding needs in an already constrained fiscal environment, we ought to explore how to ensure the airline plays the developmental and strategic asset function it has been touted for. One of the issues aviation experts have raised is the opening of direct routes to Cape Town International Airport and King Shaka International Airport, which they argue removed the network effect of having OR Tambo International Airport as the primary hub. They say this drove revenues away not only from SAA, but also sectors that benefit from the transit process,...
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