SriLankan Airlines on the verge of collapse amid ‘bleak times’

SriLankan Airlines is on the brink of bankruptcy with a total cumulative loss of over LKR 230 billion as the airline is suspending all operations in what it desscirbes as “bleak times” and the biggest challenge in its 40-year operating history.

According to the details, all payments including to lessors have now stopped and there is a high risk of lessors removing the aircraft.

Moreover, Baaghi TV has learnt that the Chairman, Ashok Pathirage, has requested US$ 150 million from the government, just to pay the salaries of 7,000 staff till March 2021. Recently, China have provided a loan of US$ 500 million to the SriLankan government for 22 million people of the country.

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However, the airline wants 30% of that to pay 7,000 staff. Despite the financial constraints the pilots have requested the Chairman to ask for an additional US$ 5 million so that they can be paid in full without any pay cuts.

If the government refuses to pay US$ 150 million, the staff will not be paid any salary for Novermber and the airline could cease to exist. In addition 80% of the cabinet ministers also want the airline shutdown. Despite the best effort of Pathirage and the board, the airlines’ days seem to be numbered.

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The debt-ridden national carrier incurred a net loss of approximately US$ 255 million by March 31 this year along with an accumulated loss of around US$ 1.77 billion.

It is pertinent to mention here that SriLankan Airlines owes about US$ 220 million to state-run Bank of Ceylon and US$ 187 million to the People’s Bank on which they are paying interest on time. SriLankan Airlines was one of the few airlines that were operating as many airlines were grounded as the Coronavirus crisis worsened.

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