Garuda told to be fully transparent
Garuda told to be fully transparent
JAKARTA (JP): Minister of Transportation Haryanto Dhanutirto
asked the national flagcarrier Garuda Indonesia yesterday to
solve its liquidity problems and to be fully transparent to the
government.
"State companies like Garuda have to be fully transparent to
the government so that we know what is really going on,"
Dhanutirto said after installing Supandi as the new president of
the 46-year old airline company.
Supandi, former Garuda's director for personnel and general
affairs, replaced Wage Mulyono who held that position for just
about three years.
The minister rejected speculations that Wage's retirement was
related to what the mass media saw as too much intervention by
his ministry in the Garuda management.
The government is involved only in the macro-policy of state
companies. But the government does not want to be called in as a
fire extinguisher when a state company is mired in severe
difficulties, he said.
"Wage's retirement was due a long time ago but his replacement
could not take place until today," the minister told newsmen
after the installation.
Rumors about the impending replacement of Wage had surfaced
only 18 months after his appointment, amid extensive mass media
reports about Garuda's financial problems due to heavy debt
service burdens. In addition, differences surfaced between the
views of the management and the ministry of transportation in the
areas of new jet procurement, the sales of old jets and flight
route distribution.
"I don't know anything about jet procurement or sales and
their prices," Dhanutirto said in reply to reporters' questions.
Procurement
He said he learned of Garuda's plans to sell its old jets and
of the changes in its new jet procurement plans only from
reports.
Supandi, who returned to Garuda in late 1993 after serving
four years as the chairman of the Batam Development Authority,
had earlier served at the airline in 1987-1989.
Both Supandi and Wage are retired air commodores and former
adjutants to President Soeharto.
Supandi told newsmen after his installation yesterday that the
government had set up a special task force of officials from the
ministries of transportation and finance and Garuda itself to
work out ways of strengthening Garuda's financial structure.
"The special team will also study Garuda's planned
privatization through a direct placement," Supandi added.
The Indonesian air carrier last month agreed to set up a
strategic alliance with KLM whereby the Dutch airline will buy a
portion of Garuda's shares.
Even though Garuda more than tripled its before-tax profits to
an estimated Rp 350.6 billion last year, the company is
reportedly facing some liquidity problems due to heavy debt
burdens.
The airline also badly needs additional funds to modernize
its aging fleet.
Fleet plans
Supandi added that Garuda periodically reviews its fleet plan
in line with its financial condition.
"For instance, we have canceled our plan to buy new jets and
will instead lease the planes," he said.
He said in 1989 Garuda planned to buy nine Boeing B747-400s,
but then changed the plan in 1993. Garuda finally bought only two
B747-400s, which are currently in operation, and will lease
another one next month.
The 11 MD-11s and 10 A300-600s currently operated by Garuda
have also been procured on a lease basis, Supandi added.
"We have canceled the procurement of nine A330 aircraft and
instead will lease only six A330s," he said, adding that the
lease agreement was still under negotiation with the Airbus
company.
He said Garuda last month sold 17 DC-9 aircrafts to an
Australian company on a cash-payment basis.
But Garuda is still seeking buyers for its 13 Fokker F-28s and
nine A-300-B4 aircraft through competitive bidding, he said.
(icn)