SOLOMONS TAKING OVER POLYNESIAN JET IN BID TO BOOST EARNINGS

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SUVA, Fiji Islands (April 9, 2001 - South Pacific Aviation/PINA Nius Online)---Solomon Airlines is taking over the Boeing 737-300 jet operated by Samoa's Polynesian Airlines, South Pacific Aviation magazine reports in its latest issue.

It is seen as a move to alleviate the financial nightmare looming before Solomon Airlines as the country's politically troubled economy moves towards collapse, the magazine reported.

Chief executive Gideon Zoloveke told South Pacific Aviation that earnings from the use of the aircraft by at least two other airlines would be retained in Australia to assist with the day-to-day financing needs of Solomon Airlines.

Zoloveke said his airline would continue to operate flights to Australia, Vanuatu and Fiji three days a week. Polynesian would use the aircraft for one day a week until the arrival of its second Boeing 737-800 in September and Australia's Flight West would be the other user.

The aircraft, to replace an older model leased from Qantas, was due to go into service subject to the completion of a deal with International Lease Finance Corporation, he said.

At the time Zoloveke spoke, the Solomon Islands had foreign reserves to cover only 17 days of imports. The country's reserve bank governor had just issued a warning that the economy would collapse unless the government accepted and immediately implemented an economic restructuring package.

Twenty months of civil war on Guadalcanal that ended late last year with a peace agreement brought all the country's major export earning industries, including tourism, to a halt. This had a disastrous impact on government revenue and also Solomon Airlines earnings, South Pacific Aviation said.

"The situation is bad," Zoloveke said, in talking about the grim business circumstances in which the airline was struggling to cope with at a time of soaring fuel and other costs and the loss of much of its normal business traffic.

He told South Pacific Aviation that with the local chamber of commerce the 100 percent government-owned airline was pressing the government to accept terms sought by donors being asked to advance most of the more than SI$ 800 million (US$ 155,840,000) the government estimated it needed for 2001 budget purposes.

On a more optimistic note, he said, flights into the Solomon Islands were featuring a return of the mainly dive-oriented tourist traffic that had vanished entirely after a June 2000 coup against the former government.

Fishing was also resuming, which meant the resumption of airfreight shipments.

Pacific Islands News Association (PINA) Website: http://www.pinanius.org 

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