🐂 Not all bull runs are created equal. November’s AI picks include 5 stocks up +20% eachUnlock Stocks

Madagascar Airlines pursues recovery with World Bank loan

EditorRachael Rajan
Published 2023-11-27, 03:42 p/m
© Reuters.

Madagascar Airlines, the national carrier of Madagascar, is negotiating a loan with the World Bank as part of its comprehensive turnaround strategy, dubbed "Phénix 2030." The airline, which has been grappling with financial challenges, has accumulated over $25 million in debt since April 2022. The loan's details are currently being discussed with the Transportation and Finance Ministers of Madagascar, with a decision expected to be finalized this month.

The "Phénix 2030" initiative comes after a period of operational reassessment for the airline. CEO Thierry de Balleuil canceled leases for Embraer E190-E2 aircraft, citing their unsuitability for the carrier's specific operational needs. This decision reflects a broader strategy to stabilize the airline's finances by making prudent investment choices and focusing on generating revenue from domestic routes before expanding internationally.

The anticipated World Bank funding aims to address immediate financial obligations, such as repaying debts to the International Air Transport Association's Financial Settlement Systems (IATA FSP). Additionally, the funds will be invested in upgrading the airline's fleet and digital systems. Initially, the government had considered a $20 million loan specifically for aircraft leases, but it has since shifted towards a more holistic approach to aid the carrier's recovery.

The airline has faced significant challenges in maintaining its operations, with supplier payment issues affecting maintenance capabilities and parts procurement. However, with the relaunch of long-haul flights and the implementation of the "Phénix 2030" plan, Madagascar Airlines is taking steps to overcome these obstacles and achieve profitability within its domestic market as a foundation for future international service expansion.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.