One of Africa’s biggest airlines warns that a fifth of its staff face job losses as the company restructures.
South Africa Airways (SAA), which employs more than 5,000 people, hasn’t made a profit in nearly a decade and survives on government bailouts. It currently has debts of over $600m (£465m).
Delivering his medium-term budget speech last month Finance Minister Tito Mboweni cast doubt on the company’s future, saying: “SAA is unlikely to ever generate sufficient cash flow to sustain operations in its current configuration.”
The airline’s top brass has taken that stark warning to heart, and is now attempting to slash costs and ease its cash flow problems.
Some in the public and private sectors are calling for state-owned SAA to be privatised. South Africa’s finance minister supports the idea, and has said the government is open to prospective equity partners.
Unions however say that would threaten its members’ livelihoods, and are vowing a shutdown should jobs be cut.