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Air Paradise and Star Air to Fly Again?

Government Reported Ready to Give the Green Light for Two Indonesian Carriers to Resume Flying.

(7/2/2006), the website of the authoritative Indonesian-language newsweekly Tempo, reports that the Department of Civil Aviation has announced that two closed Indonesian air carriers - PT Air Paradise and PT Star Air are ready to resume commercial operations sometime at the end of 2006.

Air ParadiseStar Air

The Director of Aviation in the Department, Eddy Wibowo, told the publication, "they (the airlines) are in the process of finalizing various requirements." Wibowo said PT Air Paradise will continue to operate on international routes while PT Star Air will fly as a domestic carrier.

In granting the airlines the right to resume service the Government has reportedly reviewed the viability of the operations, including the size of each airline's armada, the quality of its managerial manpower, and capital resources on hand to maintain a safe operation.

Among the requirements imposed by the government are a minimal working capital of Rp. 100 billion (approximately US$10.68 million); a fleet size of at least 5 aircraft; and the ability to employ pilots and technical staff with the skill and experience to meet government guidelines.

Claims Ahead?

When the Bali-based carrier Air Paradise suspended services in November 2005, millions of dollars in funds paid to the airline by Australian travel agents and wholesalers against future travel were lost.

Many industry observers will be watching closely to see how the substantial outstanding financial claims against the airlines will be addresses, if Air Paradise actually does resume international operations.

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