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Multimillion dollar Airbus dispute: Govt. seeks solution
View(s):The Cabinet Committee on Economic Management (CCEM) has been asked to come up with recommendations on how to resolve a dispute with Airbus S.A.S over the purchase of four Airbus A 350-900 aircraft.
The directive has gone from the Cabinet of Ministers after Public Enterprise Development Minister Kabir Hashim asked “whether the deal be cancelled” or any other measures were necessary. The CCEM, chaired by Prime Minister Ranil Wickremesinghe, has been told to make its recommendations to the Cabinet through the Ministry of Public Enterprise Development.
Besides the purchase of four Airbus A 350-900, SriLankan Airlines also obtained on lease four more. The lease has now been terminated with a controversial payment of US$ 146.5 million. Minister Hashim has told his colleagues that “SriLankan had entered into a purchase agreement dated 28.06.2013 with Airbus S.A.S. for the manufacture and delivery of four A 350-900 aircraft. The delivery dates of the aircraft were to commence from the second quarter of 2020 with the last aircraft being delivered on the first quarter of 2021. As part of the final price, pre-delivery payments commenced in 2013 and the last pre-delivery payments to be made by SriLankan Airlines (SLA) to Airbus in December 2018. According to SLA, it has paid pre-delivery payments of US$ 19,214,638.45 out of the total of US$ 222,356,600.85. Further, it has stopped to make pre-delivery payments with the approval of the Board of Directors since November 2016 and total amount due (to Airbus) is US$ 679,463.61.”
Criminal Investigation Department (CID) detectives are now probing how this purchase deal under the previous Government came about. Minister Hashim has said that “Airbus has declined to continue further discussion to revisit the purchase of A 350-900 aircraft until they receive a confirmation from SLA that these investigations are concluded. Airbus has sent SLA reminders regarding the failure to make pre-delivery payments….”.