After a decade in distress, SAA proves state owned success is possible with R9.1 billion to show for it.
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| File photo: GCIS / South African Government |
South African Airways (SAA) is soaring again this time, not just in the skies but in the economy too.
After over a decade of financial turbulence and a bruising business rescue process, SAA has marked a significant turning point. For the first time since 2012, the airline posted a profit R252 million in the 2022/23 financial year. This milestone is more than just a balance sheet triumph; it's a testament to resilience and strategic recovery.
Transport Minister Barbara Creecy, during her recent budget vote speech, celebrated the airline’s rebound as a major victory. Once crippled by debt and grounded flights, SAA is now operating without government guarantees and charting its own course toward profitability and growth.
A recent report by Oxford Economics highlights just how vital this recovery is for the South African economy. In the past year alone, SAA contributed an impressive R9.1 billion to the country’s GDP. Even more remarkably, that contribution is expected to swell to R32.6 billion by 2029/30.
Job creation is also set to take off. Currently supporting around 25,000 jobs, SAA’s recovery is projected to sustain more than 86,000 jobs within five years benefiting not just aviation, but tourism, trade, and supporting industries.
This comeback is even more striking considering the controversial attempt to privatize the airline. In 2021, government had agreed to sell a 51% majority stake in SAA to the Takatso Consortium for just R51. The consortium was expected to invest R3 billion to recapitalize the airline, but the symbolic sale price sparked intense criticism, especially given the R50 billion-plus in public funds already poured into SAA over the years.
The deal eventually collapsed in 2024 due to valuation disputes, lack of transparency, and delays in finalizing terms. Instead of being handed over for a token sum, SAA remained state-owned an outcome that, in hindsight, may have set the stage for its unexpected rebound.
Now, with a leaner structure, expanding fleet, and renewed focus, SAA is actively exploring partnerships but this time, from a position of strength rather than survival.
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