According to the International Air Transport Association, by the end of March this year, various airlines had a cumulative total of US$128 million (about R1.87 billion) in revenue trapped in Zimbabwe.
Gallo Images/Jacques Stander
South African Airways (SAA) still has around R1 billion in revenue from ticket sales stranded in Zimbabwe, which it cannot get as the southern African country continues to struggle with a liquidity crunch.
That’s according to a report by the auditor general, which forms part of the state-owned airline’s 2017/18 financial statements, tabled in parliament in March. The financial statements were not previously issued because the auditors withheld their audit opinion, as SAA’s status as a going concern presented a significant risk. SAA embarked on rescuing businesses in December 2019.
SAA won the money from the tickets she sold in Zimbabwe, but was unable to get it back.
“SAA has been unable to repatriate monies owed for ticket sales amounting to approximately US$87.9 million (approximately R1.285 billion) due to the liquidity crisis in Zimbabwe. This amount was written down in full in FY2019 as it was doubtful that the funds would be recoverable,” the AG report states.
“SAA has been successful in accessing and using some funds in Zimbabwe and has repatriated small amounts to South Africa over time. The current balance in Zimbabwe stands at $70 million (approximately R1.023 billion ).”
SAA’s acting chief financial officer, Fikile Mhlontlo, confirmed on Monday that SAA still had around R1 billion stuck in Zimbabwe and, despite “various commitments”, the airline was only able to recover “modest sums”.
Fin24 reported in July 2019 that the SAA was struggling to get funds stuck in Zimbabwean banks out of that country. A shortage of foreign exchange saw the Reserve Bank of Zimbabwe (RBZ) issue an exchange control directive to banks at the time to transfer funds into its vaults.
The RBZ guaranteed that funds would be disbursed to recipients in US dollars, a move that was aimed at preserving value after the country introduced a local currency as the sole legal tender, abandoning its old multi-currency system. SAA had to comply with the directive to transfer the funds to the central bank.
According to the International Air Transport Association (IATA), as of the end of March this year, various airlines had a cumulative total of US$128 million (about R1.87 billion) in revenue trapped in Zimbabwe. .