EDITORIAL: New SAA: A fool’s errand
It is mind-boggling that a bankrupt state remains in thrall to the idea of a national airline
Speaking of delinquent Dudu Myeni and the smouldering wreckage she left behind at SAA … It is mind-boggling that a bankrupt state remains in thrall to the idea of a national airline. This gluttonous enterprise, after all, has gobbled up more than R30bn in scarce money since 2003, and looks set to soak up a further R21bn — R16.4bn in already-guaranteed loans to its bankers, R600m to current creditors, and worst of all, R4bn in fresh capital.
And this during an economic crisis that is laying waste to SA’s anorexic tax base. If the state really wanted a return on its money, then why not use that cash to become an equity holder in two businesses that seem to have pulled it off without state assistance: Comair and new entrant, FlySafair?
Comair, after all, is in business rescue partly because SAA has failed to pay an outstanding bill. It needs a cash injection and if the state wants to be the enabler of a vibrant economy, it could do worse than take a gamble on a firm that has, for almost eight decades, proven a reliable custodian of shareholder funds.
For once, the government might find its money put properly to work. More importantly, that money would have a fighting chance of growing into more, in the form of taxes and dividends, which SA’s coffers so desperately need. Productive capital — not destructive waste.