Morocco's government and air company to sign restructuring program contract
Morocco, Business, 11/8/2001

The Moroccan government and air company "Royal Air Maroc" have started a financial, marketing and technical restructuring plan to enable the carrier to carry on its activities.

A statement by the economy, finance, privatization and tourism minister said the program will consist in increasing the company's capital to consolidate its own funds, supporting its marketing policy and settle its arrears.

Affected by the acute civil aviation crisis which hit all world air companies, and by two difficult years due to the Dollar appreciation, the hike in oil prices, and the erosion of air transport margins, the company has set up a committee that closely follows the situation and proposes measures.

In the first days following last September's attacks against the USA, the government had guaranteed the company and substituted insurers in covering risks up to one billion dollars by incident.

The government had also decided to raise tariffs, which will reduce losses from one billion DH to 750 million DH (US$ 68 million). Other measures include delaying by a year the delivery of two ordered Boeing 737 till 2003 and freezing recruitment.

RAM, which has 32 aircraft, all of them Boeings will also delay by one year the general Boeing and Airbus Purchase program under which it ordered 22 medium-haul and long-haul Boeing jetliners and four Airbus to be delivered over the 2002-2013 period.

RAM's insurance costs have almost quadrupled from 28 million dirhams to 120 million dirhams since Sept.11. The airline's number of passengers have fallen 22 percent since the day of the attacks and "winter bookings seem to be frozen," an official source had said.

"The financial status of the firm would make it impossible for the company to honor its commitments for the reimbursement of its debts estimated at some 950 million dirhams as well as running costs."

Previous Stories:
  European tour operator signs partnership accord with Moroccan tourism company   (10/25/2001)
  Moroccan bank opens branch in Barcelona   (10/9/2001)
  Due to crisis, Aeroflot suspends flights to Morocco   (10/9/2001)

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