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South African Airways (SAA) has been given the funds needed to restructure the airline as part of the government’s efforts to help state-owned entities.

Finance Minister Tito Mboweni made the announcement while delivering his Medium-Term Budget Policy Statement in Parliament.

“R10.5 billion is allocated to SAA to implement its business rescue plan. This allocation is funded through reductions to the baselines of national departments, public entities and conditional grants.”

• READ: Tito Mboweni’s Medium-Term Budget Policy Statement

The business rescue practitioners need the funds to settle retrenchment packages and launch a new airline.

The minister said that despite expenditure, the budget deficit had stabilised.

“Altogether, the in-year revised main budget deficit is now expected to be R707.8 billion, a little better than the Special Adjustments Budget. As ratio of GDP stays almost the same.”

The minister said that government had borrowed money but at low interest rates.

“We are also borrowing at favourable rates from international financial institutions. Yes, from the IMF, yes from the African Development Bank, yes from the Brics bank, so there’s no underground borrowing here.”