Photo by: Duane Daws
If South African Airways had not received a R5-billion going concern guarantee, it would have posed a systemic risk to all state-owned enterprises (SOEs) in South Africa, Deputy Finance Minister Mcebisi Jonas said on Tuesday.
Jonas, who made a few introductory remarks, was part of a delegation from National Treasury and SAA who briefed Parliament’s Standing Committee on Finance on the airline’s preliminary financial statements for 2014/15.
He said SAA would have been unable to finalise their financial statements without a guarantee. “But it would have been been prudent to give that kind of support without first mitigating the fiscal risk.”
Jonas pointed out that SOEs’ financial position poses a significant risk to South Africa’s fiscal position. In fact, the financial well-being of all CEOs is being taken into account when rating agencies assess South Africa’s credit risk.
Before handing over to acting CEO Musa Zwane, Jonas said the R4.7-billion guarantee SAA received put the airline in a position to finalise sets of financial statements for both 2014-15 and 2015-16.
The 2015-16 financial statements would be finalised before September 30 this year, Jonas said.