| President Cyril Ramaphosa addresses the members of the South African Foreign Correspondents Association in Johannesburg, South Africa November 1, 2018. Gianluigi Guercia/Pool via REUTERS |
South African President Cyril Ramaphosa said on Tuesday that closing down struggling state-owned South African Airways (SAA) could collapse the country’s public finances as the government would have to service its debts immediately.
Finance Minister Tito Mboweni said last week that 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 that SAA carries becomes payable immediately and will have an impact on the debt that is carried by all the other state-owned enterprises. That is how you are then able to even collapse our fiscus,” Ramaphosa told parliament.
Ramaphosa added that it would be difficult for the government to get value from selling SAA as the airline is laden with debt.