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That's an interesting list. But if anything, everyone of them provides a counterexample to how SAA is done, and proposed to be done. A thread... https://twitter.com/Sentletse/status/1272976109035048962
China: Government has been introducing private shareholders into the three state-owned airlines for some time https://www.efe.com/efe/english/business/china-opens-state-owned-airlines-to-private-investment/. Have a look at China on this list: not one single case of increased investment in airlines by the state in China: https://www.efe.com/efe/english/business/china-opens-state-owned-airlines-to-private-investment/
UAE: Emirates is a success story. The UAE government has received $4bn in dividends for $90m in investment since it was founded in 1985. It has grown >20% every year since founding. There is a prohibition on bailouts. Can/should SA emulate this? No - I'll come back to why
Qatar: A rare eg of an airline growing state ownership. 50% pvt sholders (well, ex ministers) were bought out in 2013. It has now bought into several other airlines including 1/4 of IAG (Brit Airways). Competitors have regularly alleged it has received masses of state support.
Singapore: Is a listed company with a diverse shareholding. Its biggest shareholder is Tamasek (55%), the SWF of Singapore. It is run on strictly commercial lines, like Tamasek's large portfolio. The state does not direct its activities.
Ethiopia: Ethiopian is an excellent example of commercial principles being applied to an airline and is now Africa's leader. To facilitate growth it is now seeking partial privatisation to facilitate growth https://www.voanews.com/africa/ethiopia-plans-privatize-key-state-enterprises
So what do these examples tell us that is relevent to SAA?
First, they are all run on strictly commercial principles. They are not forced to fly unprofitable routes nor to keep staff they don't need. Highly competent management is in place at all of them. Government never interferes with their commercial decisions.
Second, in all but Qatar and Emirates, these airlines either have or are seeking to have private shareholders. Across the world the clear trend in airlines has been for gvts to reduce interests, often exiting completely. See for yourself: https://www.efe.com/efe/english/business/china-opens-state-owned-airlines-to-private-investment/
So what of Qatar and Emirates? They are city states focused on diversifying their economies. There is no domestic market so links to the rest of the world are critical. State airline is therefore strategically important. Still, commercial principles rule. And pvtisation may come.
In the case of SA ... There is a domestic airline industry. If anything it has been harmed by the unfair competition posed by SAA. Strategic routes that gvt considers important can be directly subsidised (as happens in Europe to develop tourist markets)
The minister has said 2 things in favour of supporting SAA I'm aware of: that it is essential to the national industry and that it provides gvt with an important tool, e.g. repatriating citizens from Covid-19. I can't see the logic of either of these points.
Yes, SAA is an important maintanance and volume provider for other airlines and airports. But the ownership model does not follow from this. A proper business rescue would have sold the parts, taking care with the rest of the industry to ensure key services continue
Many countries repatriated citizens without owning airlines. They chartered aircraft. So owning an airline for public services just doesn't make sense. In fact, ensuring a competitive market with multiple players the better way to ensure gvt can access services at the best prices
So I'm still in the dark here. Just what is it that Gordhan thinks is so important, a time of fiscal crisis, to try and force billions more to be poured into an airline that is just unnecessary?
Apologies just realised one of the links above was incorrect. Here is a good list of airlines, state ownership, and trends: https://www.icao.int/sustainability/Documents/PrivatizedAirlines.pdf
