EDITORIAL: SAA sell-off not so easy
Getting private sector players involved will take more than putting a stake up for sale
Selling off a stake in South African Airways (SAA), as the National Treasury has proposed, may be easier said than done, as the Indian government will be quick to tell you. The similarities between state-owned Air India and SAA are plentiful: both have been running at losses for years, relying on government bailouts to keep flying; they are deeply in debt; and they need to cut jobs to bring staffing levels in line with global best practice. That is politically difficult in either country. That they have been operating at losses in recent years, when oil prices — a major cost driver for airlines — have been at multi-year lows, boosting competitors’ profit margins, shows there is much room for operational improvement. Unlike the South African government, Indian Prime Minister Narendra Modi and his government officially put out a tender to find a buyer for a 76% stake in the national airline. More than a year later, there hasn’t been a single bidder. Potential buyers have sniffed aroun...
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