ECONOMIST ON SAA – ‘GIVE IT AWAY, IT WON’T FLY’

ECONOMIST ON SAA – ‘GIVE IT AWAY, IT WON’T FLY’

SAA was given a further R5 billion in the MTBPS address last week, but that is far short of the more than R20 billion it says it needs as it tries to break even by 2021.

Economist Professor Jannie Rossouw says South African Airways (SAA) is a vanity project that will not fly and it should be given away.

Rossouw, who heads the Fiscal Cliff Study Group, has told Parliament’s finance committees taxpayers cannot afford any further bailouts for the airline.

SAA was given a further R5 billion in the Mid-Term Budget Policy Statement address last week, but that is far short of the more than R20 billion it says it needs as it tries to break even by 2021.

Rossouw said hard-pressed taxpayers cannot afford to keep on bailing SAA out.

“Give it away, it will not fly, we are tired of a vanity project. I have heard in this committee that politicians are proud to see SAA aeroplanes parked at international airports. Park the things there and wash them! It’s cheaper than to try and fly them.”

As for the idea of SAA and SA Express being merged, Rossouw said: “I’ve never seen two bankrupt companies being merged to make a success.”

Rossouw repeated his call for the government to buy only vehicles made in South Africa and now he has had a post-graduate student run the numbers.

“We’ve shown it will increase domestic employment, it will increase GDP (gross domestic product) by R36.8 billion if the government refrains from buying imported vehicles, it will increase tax collection.”

LISTEN: Buying only SA-made vehicles could boost GDP by R37bn

Gaye Davis / EWN

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