PAL readmitted to IATA

PAL readmitted to IATA

MANILA (AP): Philippine Airlines said Monday it has been readmitted to the International Air Transport Association after settling its debts with the airline industry body.

PAL was suspended from the IATA's clearing house in September 1998 after it failed to pay debts of US$32 million to other airlines. At that time, debt-laden PAL was on the brink of bankruptcy and struggling to get its creditors, owed $2.2 billion, to accept a recovery plan.

PAL's suspension from the IATA was a serious blow to the ailing carrier because it effectively severed its links with the association's 198 member airlines. Passengers with PAL tickets were unable to transfer to other airlines.

Passengers traveling from Manila to New York, for example, had to purchase separate tickets on PAL and a second airline and manually recheck their baggage since PAL does not fly beyond the U.S. West Coast.

"PAL has now returned to the fold of the international aviation community," PAL president Avalino Zapanta said in a statement. "This is a major step in our inexorable march to full recovery."