The Saga of Garuda Indonesia

The Saga of Garuda Indonesia

JI-Jakarta. The government should expedite the disbursement of its commitment of Rp 7.5 trillion (US$500 million) in additional equity capital to Garuda Indonesia despite a court decision on Monday to postpone to next week its ratification of the debt-restructuring agreement between the airline company and its creditors. The national flag carrier urgently needs additional working capital to immediately expand its passenger and cargo services and strengthen its credibility in leasing more airplanes to boost revenues in order to meet debt-repayment schedules, which start next April. The latest hiccup at the court session on Monday, which arose from the objection of two creditors, will no longer affect the debt-restructuring plan that was approved by more than 95 percent of Garuda’s creditors last week. Strong government support also will make Garuda more attractive to new investors and strengthen its competitiveness.

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