Finance Minister Tito Mboweni has reportedly yielded to the African National Congress’s (ANC) refusal to liquidate South African Airways (SAA) at the party’s national executive committee meeting and lekgotla.
According to the City Press, Mboweni proposed the embattled airline be liquidated and start a new one.
The meeting opted for a restructuring process instead which could reportedly cost government at least R10 billion.
The embattled state-owned company is fighting for its survival after it entered a form of bankruptcy protection last month and cancelled some flights due to cash shortages.
The paper is reporting that the ANC’s directive to treasury is to restructure the financially strapped airline and that could cost a further R8 billion to cover expenses related to the restructuring.
The finance minister had to agree with the party’s highest decision-making body during the meeting in Irene Pretoria last week.
The paper says critics say liquidating Eskom could possibly cost R50 billion and that could result in an undesirable credit downgrade for the country.
SAA was promised R4 billion of funding from lenders and the government to sustain rescue efforts but only received R2 billion from lenders.
Mboweni has been instructed by the governing party’s top brass to make R2 billion available to keep the airline going as part of the ongoing business rescue process.
More Stories
Eskom Reduce Sunday Blackouts
KZN Battered By Severe Flooding Once Again
Power Cuts To Continue Into The Weekend – Eskom
Eskom Confirms Sabotage At Tutuka Power Station
We Listened To The People – Ramaphosa
NICD Reports 7 238 New COVID-19 Cases In SA
NICD Reports 8 179 New COVID-19 Cases In SA
Nersa Opposing Legal Bid To Overturn Decision To Grant Karpowership Licences
Gift Of The Givers Slams Government For KZN Slow Response
After Criticism, Mthethwa R22m Flag Project To Be Reviewed – Mthethwa
Health Department Opposes Challenge To New Regulations
Mthethwa Defends R22m Flag Project