6,000 SriLankan employees’ jobs at risk if immediate restructuring measures are not implemented – Minister

Ports and Civil Aviation Minister Nimal Siripala de Silva expressed concerns about the potential loss of jobs for around 6,000 employees at SriLankan Airlines if immediate restructuring measures are not implemented. Addressing a press briefing held at the Presidential Media Centre yesterday (30), he emphasized that the government cannot sustain the financial losses incurred by SriLankan Airlines and it would be unfair to continue using taxpayer funds in this manner. To address the situation, the government has already initiated efforts to engage the support of international financial experts, with the aim of conducting the restructuring process in a transparent manner, as part of their commitment to building a stable country.

Addressing the media briefing, Minister Nimal Siripala de Silva said; “SriLankan Airlines, established as our national carrier many years ago, holds a unique position. While it managed to generate a profit of Rs. 30 million during the period it was under the control of Emirates Airlines, it has struggled to achieve profitability otherwise.

The airline is primarily funded by the taxes of ordinary citizens,including those who have never experienced air travel. We take pride in having our own national airline, but we must question whether the cost associated with maintaining it is justified.Presently, SriLankan Airlines carries a debt of US$ 1.2 billion. Various organizations, including local state banks, have had to cover outstanding payments for international bonds and leased planes.

Additionally, we have accumulated unpaid fuel bills. Operating an airline under such immense debt is unsustainable.Due to economic challenges, including foreign exchange difficulties, the government is unable to provide financial support for losses as it has done in the past. This approach is no longer equitable, which led to the decision to restructure SriLankan Airlines. The restructuring plan entails the government retaining a 51% share, with the remaining 49% to be offered to another investor.

The proposal for the restructuring process of SriLankan Airlines was submitted to the Cabinet six months ago. Although some profits are generated through ground operations and SriLankan Catering Company, they are insufficient to cover the airline’s losses.Considering the need to sell shares separately and the memorandum presented to the Cabinet, a series of proposals have been forwarded to international financial experts through the Ministry of Finance. We are committed to transparently maximise the benefits of this process.

 

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