Bali Discovery Tours: Homepage
Bali Hotels, Bali Villas and Bali News from balidiscovery.com
Home Bali Contact Bali Practicalities Bali News Bali Services Bali Transportation Bali Sports Bali Excursions Bali Villas Bali Hotels
Home · News · Rescuing Garuda
Bali Hotels, Bali Villas and Bali News from balidiscovery.com
Bali Hotels
Bali Villas
Special Deals!
Packages
MICE Handling
Bali Excursions
Culinary - Dining
Guided Tour
Bali Spas
Bali Sports
Diving
Golf
Bali Transportation
Car Rental - Selft Drive
Private Jet Charter
Bali News
Bali Services
Bali Practicalities
Bali Contact
Bali Career
Home
 
Bali Update
Subscribe to our free weekly newsletter!
 
PATA header
PATA Gold Award 2007
Bali Update
PATA Gold Award Winner 2007
 
Bali Contact
Bali Discovery Tours
Komplek Pertokoan
Sanur Raya No. 27
Jl. By Pass Ngurah Rai,
Sanur, Bali, Indonesia

Tel:
++62 361 286 283

Fax:
++62 361 286 284

U.S.A. Fax:(toll free)
1-800-506-8633

U.K. Fax:
++44-20-7000-1235

Australian Fax:
++61-2-94750419

24h:
++62 812 3819724

Bali Discovery

SITE PATA ASITA
Bali News

Rescuing Garuda

Editorial: Following US$ 107 Bailout by Government of Indonesia's National Carrier, an Editorial in the Jakarta Post Asks Will this Be Sufficient to Save Garuda?


Bali News:
Click Image to Enlarge

(9/25/2006)

A recent editorial in the Jakarta Post praised the last-minute cash bailout of US$107 million (Rp. 1 trillion) provided by Indonesian legislators for Garuda Indonesia but posed the question if such help provides anything more than short-term superficial relief.

In the words of the Jakarta Post: "Without debt restructuring to reduce its debts to a sustainable level, without new strategic investor to bring in synergy and without significant progress in operational restructuring, Garuda will again suffer a liquidity crisis and could eventually go bankrupt. After all, Garuda is burdened with almost $1.2 billion in debts and an annual debt servicing burden of $110 million."

And, indeed, the government cash injection granted on Thursday, September 14, 2006, is little more than a short term palliative for what ails the Carrier. Considerably less than the US$230 million sought by Garuda to allow continuing operations while it negotiates "another" debt restructuring deal with it European creditors, the US$107 million given by the Government will keep the Airline in the air for now but leave it little room for seeking its second debt restructuring since 2001.

While crediting Garuda with successfully reducing its losses in 2005 to Rp. 675 billion from Rp. 875 billion suffered the previous year - lower demand for international flights to Indonesia dating from the 9-11 terrorist attack of 2001, escalating fuel prices and a highly competitive deregulated domestic airline environment have all taken their toll on the Indonesian carrier's bottom line.

Simply Not Enough

Mounting losses and persistent demands for repayment of debt, according to The Jakarta Post, could make "this latest financial assistance. . . meaningless within a few months if Garuda cannot conclude another debt restructuring deal with its domestic and foreign debtors to reduce its debts to a sustainable level."

The newspaper added: "But a sustainable debit level is not enough. Given the keener competition within the domestic and international markets, Garuda needs significant corporate restructuring and a new strategic investors to strengthen its competitiveness. Garuda requires a new strategic investor to strengthen its capital, improve its efficiency, modernize its jets and make its route network more efficient. We should not be such narrow-minded nationalists as to oppose a minority foreign shareholder in Garuda, despite its role as the national flag carrier. The other alternative is another bailout at the expense of taxpayers."

Urging more financial support The Jakarta Post is positive about Garuda's future saying "despite its current financial distress, (Garuda) has a promising future, providing it can strengthen its efficiency and improve its service to international standards. And, most importantly, it has a vital role to play in servicing the vast archipelago and the Asian region."


© Bali Discovery Tours. Articles may be quoted and reproduced if attributed to http://www.balidiscovery.com.

       

 
Bali News by Bali Update
Subscribe to the Bali Update
Receive the latest news from Bali by email!



Our [Privacy Statement] explains how we handle the data you are providing.

 
Bali News by Bali Update
Explore the Archive of the Bali Update
Find related articles in our news archive!




or try to use Google Search :

Home · Bali Hotels · Bali Villas · Bali Excursions · Bali Sports · Bali News · Site Map · RSS

Bali News: More News
Russian Loses Battle with Indonesian Military
Russian Tourist May Face 7 Years in Prison for Robbing an Ungasan, Bali Moneychanger
(7/29/2016)
These Streets are Made for Pedestrians Denpasar Officials Seek to Keep Sidewalks Clean of Street Ven
Pushcart vendors (Pedagang Kaki Lima - PKL) who circulate Bali’s capital of Denpasar are blamed for causing dirty streets, traffic jams and a host of other social ills.
(7/29/2016)
Shot with a Camera and a Gun
Police Shoot Kuta, Bali Thief After Theft from Tourist Caught on CCTV Camera
(7/29/2016)
Bali by Ancient Books
Traditional Lontar Exhibition at Hatten Wine Building August 4 – 7, 2016
(7/29/2016)
The Toast of Bali
St. Regis Bali Kayuputi and Laguna’s Arwana Cited by Wine Spectator Magazine
(7/29/2016)
Are you on the Run?
More than 1,500 Participants Expected at Herbalife Bali International Triathlon August 14, 2016
(7/25/2016)
Death at Double Six Beach
Canadian Presumed to Have Drowned Off Double Six Beach in Bali
(7/25/2016)
Danish Tourist Dies on Tour
Danish Tourist Dies of Apparent Heart Attack While Touring Bali’s Rice Terraces
(7/25/2016)
Going Ape on Your Birthday
Niluh the Orangutan Invites 55 Children to Celebrate Her Birthday and National Children’s Day at the Bali Safari Marine Park
(7/25/2016)
Let the Dream of a Better Tomorrow Begin
Beyond Bali: Sumba Hospitality Foundation Inaugurate East Nusa Tenggara’s First Hotel School in West Sumba
(7/25/2016)
One Moment in Time
MOMENTS – An Exhibition of Photography by Michael Johnsey July 29- August 11, 2016
(7/25/2016)
Illegal in Plain Sight
Local Transport Drivers Enraged Over Billboards Advertising Illegal Online Transport Services
(7/24/2016)
All [News]!