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Govt. seeks Saudi aid to uplift SriLankan and get dollars to buy fuel
The Government has begun talks with the Saudi Fund for Development (SFD) to finance Sri Lankan Airlines and find US dollars to pay for its fuel, Tourism and Aviation Minister Prasanna Ranatunga said.
He said that although the SFD usually provided assistance for social and infrastructure projects, the Government had decided to approach the Saudi agency due to the financial situation of the airline and its fuel bills. Negotiations may be based on a short-term or long-term facility depending on the SFD’s response. The quantum of the loan is yet to be decided, he said.
The move comes in the wake of the Ceylon Petroleum Corporation (CPC) demanding from SriLankan Airlines that it pays its future fuel bills in US dollars, instead of rupees. Talks with the CPC on the matter were ongoing, the minister said.
SriLankan Airlines owed the CPC Rs 330 billion. It had recently made a payment of US dollars 30 million while the balance remained as outstanding arrears.
However, Energy Minister Udaya Gammanpila told the Sunday Times they required payments in US dollars in view of the difficulties faced by the CPC in raising the required dollars to buy fuel from abroad.
The massively loss-making SriLankan Airlines said that in addition to the outstanding debt to the CPC, it needed to raise USD 1.3 billion this year to breakeven.
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