South African Airways Chairperson Quits As the National Carrier Continues With Financial Struggle
South African Airways board chairman Johannes Bhekumuzi Magwaza has resigned, Public Enterprises Minister Pravin Gordhan revealed.
The Minister while delivering his budget vote in parliament on Thursday disclosed that Magwaza resigned from SAA for personal reasons.
“We would like to thank the outgoing Chairperson of the SAA Board, Mr. JB Magwaza. Your contribution is appreciated,” said Gordhan.
Reportedly, Magwaza, who joined the embattled carrier in 2017, is set to leave at the end of July.
His resignation comes a month after the chief executive officer Vuyani Jarana quit his position at the national carrier citing a lack of funding and drop in government support for the carrier’s turnaround plan.
The departures by the two top executives depict the difficulties the state entity is facing. SAA as well as a number of other state-owned facilities have had a history of being dependent on government funds, private sector support, and taxpayers money to stay afloat.
Reports indicate between 1999 – 2017, ZAR 29 Bn was spent on SAA bailouts. The company continues to make losses despite financial support by the government over the last five years that have amounted to ZAR 30 Bn. The firm has not been able to make profits since 2011.
Earlier, SAA management acknowledged the liquidity and solvency challenges adding that it has taken the necessary steps to make sure the airline remains operational.
“SAA has a weak balance sheet, relies heavily on government guarantees to remain operational, and has not been profitable in the last few years. The situation is not only undesirable but unsustainable, and this led to the development of the turnaround plan that has been put in place.”
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