South Africa: SAA’s original sin is state capture, not Covid says Gordhan

By Xolisa Phillip, in Johannesburg

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Posted on March 30, 2021 14:30

Reuters/Mike Hutchings

Can South African Airways (SAA) see blue skies after a long and difficult turnaround operation? There are still substantial issues to overcome: SAA’s debt, the opacity of its accounts, a stand-off with the pilots. But public enterprises minister Pravin Gordhan says the problems stem from corruption hangover from the Zuma era: state capture.

While many airlines in recent months have been grounded due to lack of passengers and tourism in a time of coronavirus, that is not what is ailing South African Airways (SAA).

The original sin at the troubled national carrier is state capture, not Covid-19, says public enterprises minister Pravin Gordhan.

The phenomenon hit the whole group; including subsidiaries Mango, the low-cost domestic and regional airline; SAA Technical (SAAT), the aircraft maintenance specialist and AirChefs which provides in-flight meals.

Years of unchecked state capture culminated in SAA crash-landing into state bailout on 6 December 2019 and it has been a costly endeavour.

As of December 2020, R200m ($13m) in fees has been paid — and counting. The government has so far coughed up R7.8bn ($522m), with another R2.7bn ($180m) still to come, for restructuring and recapitalising SAA’s subsidiaries.

The R7.8bn

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