Legislators divided over 'Garuda, Merpati reshuffle'<\/p>\n
Fitri Wulandari, The Jakarta Post, Jakarta<\/p>\n
Legislators are divided over the government's plan to reshuffle
\nthe top management of two state-owned airline companies, Garuda
\nIndonesia and Merpati Nusantara Airlines.<\/p>\n
The Office of the State Minister of State Enterprises
\nannounced the plan on Monday, arguing that the reshuffle was
\nneeded to improve the performance of the two airlines amid
\nturbulence in the industry.<\/p>\n
Rosyid Hidayat of the House of Representatives Commission IV
\nfor transportation and infrastructure, supported the reshuffle
\nplan, saying that it was the best option to help lift the
\nperformance of the two companies.<\/p>\n
\"Their performance, so far, has not been particularly good.
\nNew faces might bring fresh ideas,\" Rosyid told The Jakarta Post
\nWednesday.<\/p>\n
In 1998, Merpati suffered a loss of Rp 57.4 billion (US$5.52
\nmillion), but then made an operating profit of Rp 93.9 billion in
\n1999. The following year, operating profit was down to Rp 51.2
\nbillion but picked up slightly to Rp 74.2 billion last year.<\/p>\n
Merpati director Wahyu Hidayat said that the fall in operating
\nprofit was due to rising fuel prices and a weakening rupiah
\nexchange rate against the U.S. dollar. not because of poor
\nmanagement. Local airlines' cost structures are dominated by
\ndollar-based expenses.<\/p>\n
Only 35 out of its 60 aircraft of various types ranging from
\nBoeing 737-200s down to Twin Otters are in full operation.<\/p>\n
Another legislator, Rully Chairul Azwar, however, opposed the
\nplanned reshuffle, saying that the current board of directors of
\nboth Merpati and Garuda had managed to improve the performances
\nof the two airlines.<\/p>\n
\"There have been significant changes within Merpati and
\nGaruda. If the reshuffle is to go ahead, it should proceed by
\ncarefully assessing various aspects,\" Rully said.<\/p>\n
He considered that both companies, especially the flagship
\ncarrier Garuda, had been on the right track to emerge from their
\nfinancial problems.<\/p>\n
\"Garuda has successfully restructured its debt. Now, they are
\nmoving on to improve their operations. It is a good sign,\" he
\nsaid.<\/p>\n
Garuda finalized its debt restructuring last year.<\/p>\n
The company's 44 aircraft are all fully operational and serve
\n21 domestic and 22 international destinations.<\/p>\n
Rully admitted that the situation was more difficult with
\nMerpati. However, there was still the chance for improvement, he
\nasserted.<\/p>",
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