SAA Argentina route cancellation: Gigaba should clarify

Public Enterprises Minster, Malusi Gigaba, should without delay, provide clarity on why South African Airways (SAA) is cancelling its flight route to Argentina.

In 2012 Argentina was South Africa's second largest tourism market in South and Central America, with an estimated 96% of Argentinians arriving in South Africa by air.

The cancellation of this route could result in a reduction of Argentinian tourists in South Africa and possibly affect jobs.

Reports indicate that the Argentinian route will cease operation in the beginning of 2014 due to annual losses on the route of up to R50 million. It is rather bizarre as the state carrier has opted to maintain its route to Beijing where it incurs an annual loss of up to R300 million - R250 million more than the Argentinian route.

The DA will be submitting parliamentary questions to determine what criteria SAA used in deciding to cancel the Argentinian route and whether it will be re-opened in the future. 

We will also request that the Minister urgently table SAA's full turnaround strategy. In a briefing to Parliament's Portfolio Committee on Public Enterprises last month, Minister Gigaba only provided a truncated version of the turnaround strategy and failed to provide clarity on critical matters such as:

Costing;

• Whether it will result in any job losses;
• Whether the airline is planning on cutting and introducing routes; and
• Whether SA Express, SAA and Mango Airline will merge.

The Minister cannot continue to withhold critical information about the performance of the publicly funded SAA. Parliament and the public need to know how and why financial decisions at SAA are made, particularly as it has made over R16 billion in losses in the last number of years.

I trust that Minister Gigaba will provide a full briefing on the cancellation of the Argentina route before the 2013/14 tourism season is negatively affected.

Statement issued by Natasha Michael MP, DA Shadow Minister of Public Enterprises, November 6 2013

Click here to sign up to receive our free daily headline email newsletter