State-owned South African Airways (SAA) will receive R5-billion through a special appropriation Bill to settle debt redeeming between now and March 2019.
The Medium Term Budget Policy Statement (MTBPS), which was released by the National Treasury on Wednesday, stated that the funds would help to prevent a call on the airline’s outstanding debt of R16.4-billion.
The total R19.1-billion debt facility is guaranteed by government.
Additionally, R1.2-billion has been allocated to SAA subsidiary South African Express.
The MTBPS said SAA is not generating sufficient cash to repay its total debt and will have to negotiate with lenders to refinance or extend maturity dates.
Finance Minister Tito Mboweni said during his maiden MTBPS address that the restructuring of State-owned enterprises such as SAA would require effective partnerships with the private sector.
He added that these entities should consider the disposal of assets, as well as the closure of uneconomic assets.