S.Africa halts funding to cash-strapped national carrier

South Africa’s flag carrier was Tuesday denied more government funding for its state-led rescue plan,, as resources are directed toward lessening the economic impact of COVID-19 on citizens and businesses.

South African Airways was placed under a state-approved rescue plan in December and its government-appointed independent business administrators had since requested an additional 10 billion rand ($550 million) in funds toward the rescue plan.

But minister of public enterprises, Pravin Gordhan said “government is unable to provide additional funding to sustain the business rescue process beyond the funding that has already been provided to the airline,” in a letter quoted by local media and dated April 10.

The decision deals a severe blow to SAA, which has since 2011 failed to make a profit, surviving on government bailouts.

The airline received 3.5 billion rand ($2.4 million, 2.2 million euros) from the Development Bank of South Africa in January.

The rescue plan was a last-ditch bid to avoid total collapse of the airline which employs more than 5,000 workers. It has a fleet of more than 50 aircraft flying to domestic and international destinations.

But SAA has grounded all of its passenger flights, apart from charters to repatriate stranded citizens, due to the COVID-19 lockdown which is further crippling the ailing carrier.

South Africa has the highest recorded numbers of coronavirus infection in sub-Saharan Africa, with 2,415 cases including 27 fatalities.