South Africa considering sale of state assets to fund airline

South Africa is evaluating assets it could sell to pay for this month’s ZAR2.2b (US$169.5m) bailout of unprofitable South African Airways, Finance minister Malusi Gigaba said in letter to parliament. The govt’s decision to settle a debt owed by the airline to Standard Chartered mustn’t affect the balance of this year’s budget, Gigaba said in the note to Baleka Mbete, speaker of the National Assembly. Further details will be provided in October, he said. South Africa’s economic downturn, the downgrading of the country’s foreign-currency debt and a “rapid deterioration” of SAA’s cash flow triggered the need for “urgent action” regarding the airline, Gigaba said. The bailout prevented SAA from defaulting on the loan, which would have led to cross defaults of almost ZAR14.6b of other debt, he said. <br/>