“This restructuring is crucial as the federal government can now not afford to inject cash into working the airline,” he stated.
“Yearly the federal government has been offering the airline between USD 80 billion to USD 200 billion to run its operations,” de Silva stated.
The minister stated the income from the sale of the catering operation can be utilized to repay debt amounting to USD 80 million that was obtained by mortgaging its shares, in addition to another loans.
The airline’s debt at present quantities to USD 1.226 billion (LKR 401 billion), he stated.
The airline, fashioned in 1979 as Air Lanka, was rebranded Srilankan Airways underneath the administration management of Emirates in 1998. In 2007, the federal government took again management of it from the Emirates.
Srilankan Airways is amongst over 190 state-owned enterprises which can be making big losses.
With out retaining a 51 per cent stake within the airline, Sri Lanka may lose possession of the businesses to be offered, Economy Next information web site quoted minister de Silva as saying.
“But when the buyers are Sri Lankan nationals, we are able to go for extra. There are various wealthy folks in Sri Lanka, they will come collectively as a syndicate or with airways and provide a bid,” he stated.
Sri Lankan President Ranil Wickremesinghe has referred to as for a lot wanted reforms for the loss-making nationwide provider.
Based on Colombo-based assume tank Advocata, SriLankanAirlines has, on quite a few events, required treasury assured loans to remain afloat, and has amassed over LKR 53.6 billion in ensures as of August 2021, the report stated.
Sri Lanka, a rustic of twenty-two million folks, is underneath the grip of unprecedented financial turmoil, the worst in seven many years. The disaster that has left thousands and thousands struggling to purchase meals, drugs, gasoline and different necessities.
The island nation is at present scrambling to chalk out a staff-level settlement with the International Monetary Fund (IMF) for a bailout programme, which may very well be the antidote for the nation’s present financial travails.
The nation, with an acute overseas foreign money disaster that resulted in overseas debt default, had introduced in April that it’s suspending almost USD 7 billion overseas debt compensation due for this 12 months out of about USD 25 billion due by means of 2026.