Qatar pulls out from the Gulf airlines
Qatar, Economics, 5/31/2002

Abdullah Bin Hamad al-Ateyah, the Qatari minister of energy and industry and Qatar's representative to the board of the Gulf Airline company said in a press statement on Wednesday that Qatar decided to withdraw from the Gulf airline company after it had refused in the extraordinary meeting of the general assembly which was held on Wednesday in Abu Dhabi to pay a sum of 250 million Riyals to the company which suffers difficult financial conditions and debts estimated at USD 800 million.

Sheikh Hamdan Bin Mubarak al-Nahyan said "we do thank Qatar and honor its decision," noting that the legal matters and other issues behind Qatar's withdrawal are being studied at the meantime.

He added that the other three partners in the Gulf airline who are Abu Fhabi, Oman and Bahrain will pump a sum of 30 million Bahraini dinars ( USD 80 million) in the capital of the said company and this sum will be distributed equally on the three states. Sheikh Hamdan also indicated that Qatar's share in the Gulf airline company which is 25% will be distributed equally on the three member states in a way that each members will have one third of the company.

Sheikh Hamdan indicated that the company's director general James Fokin who was appointed on February 13 will present a plan to reorganize matters so as to get the company out of its crisis, but he did not give details about this plan, saying that this plan will be debated during the company's board meeting to be held in August. He explained, thanks to this plan, the company will be better. He said that new lines will be established and others will be cancelled. Sheikh Hamdan did not specify if the company's board had decided to increase the capital recently set at USD 344 million.

In May 2001, the four owners of the company pumped USD 160 million in it but its difficulties have been escalated since the September 11 attacks, 2001 against the US.

However, economists estimated the deficiency of the company at USD 100 million, It owns 32 planes and runs flights on 50 lines. Since the beginning of May both Qatar and Oman, with each of them established a national airline company, refused to support the company and this rejection was followed by a decision of the board held in April 23 in Abu Dhabi to pump USD 272.5 million in the company's capital. The new plan states to reduce the fleet, canceling of several non- profitable lines and a plan to reduce number of employees now estimated at 5200 through early retirement.

Previous Stories:
  Morocco, Qatar sign package of agreements   (5/27/2002)
  Bridge linking Bahrain- Qatar to cost 1.5 billion   (5/27/2002)
  Qatar's economy minister to visit Iraq in June   (5/27/2002)

Please add a link on your webiste pointing to ArabicNews.com and bookmark ArabicNews.com & subscribe to our daily email news bulletin.

Search