SAA, big test for transformation promises

On the eve of its crippling strike SAA warned that it would apply the principle of no-work, no-pay to strikers but trade unions went ahead with the strike. They are asking for an 8% increase. At first SAA said there would be no wage increases but then they offered an above-inflation increase of 5,9%, retroactive to April 1.

On Thursday last week Pravin Gordhan affirmed that the government was ready to make “tough decisions” in the face of the crippling strike. To add to this, Gordhan, speaking at a conference in New York, stated bluntly that SAA was “not too big to fail”.

It will be interesting to see if SAA caves. If they do, all the talk about not bailing out bankrupt SOEs will prove to be false and South Africa will take one more step toward the slippery slope of a failed state. It will prove that Cyril has no say in the matters of government and Moody’s will be getting ready for our downgrade to junk in February 2020.

But if SAA stands strong, it might be the first glimmer of hope for our long-awaited turnaround. This might ripple through to Eskom, PRASA and all the rest. Business confidence, and with that investor confidence, will pick up and our depressed economy might just get that first spark it needs to start the engine of prosperity. A long shot we know, but it is that time of year when we can sit back and dream a bit.

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