The Centre for Asia Pacific Aviation has questioned moves by the Indonesian government to pump millions of dollars into its ailing airlines.
The Indonesian Government plans to inject approximately US$110 million and US$50 million into Garuda Indonesia and Merpati Nusantara Airlines, respectively, from the 2006 National Budget.
CAPA said that while both Malaysia Airlines and Air China are to get government support, the situation with Garuda and the central government in Jakarta is different.
Said CAPA, “Unlike Malaysia and China, where coherent government policies to restructure and develop the aviation sector are progressing, Indonesia’s latest funds injections seem designed only to cover short-term cash problems, without addressing the fundamental issues.
“The funds are inadequate to help the two state carriers conduct meaningful reorganisation and serve only to suspend them in a continuing cycle of government dependence.”
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