South African President Cyril Ramaphosa said closing down struggling state-owned South African Airways (SAA) could collapse the country’s public finances as government would have to service its debts immediately.
Finance Minister Tito Mboweni said last week his preference would be to close down the debt-ridden airline.
“If we for instance were to say let it be shut down, it basically means the debt SAA carries becomes payable immediately and will impact on the debt carried by other state-owned enterprises. That is how you are then able to collapse our fiscus,” Ramaphosa told parliament.
Ramaphosa added it would be difficult for government to get value from selling SAA as the airline is laden with debt.