The Ministry of Aviation’s dues for the Ministry of Petroleum increased to EGP 7bn by the end of November 2015, compared to EGP 5.5bn in June 2015.
A senior official at the Egyptian General Petroleum Corporate (EGPC) told Daily News Egypt that the debt has increased due to the Ministry of Aviation’s suspension of payment of the entire value of fuel acquired. The ministry also stopped paying the monthly instalment of the old debt until November 2015.
The national carrier, EgyptAir, has defaulted on monthly instalments of the old debt, which amounted to EGP 25m. EgyptAir consumed fuel worth between EGP 450m and EGP 500m per month. The number of planes owned by EgyptAir Holding Company recorded 81 aeroplane, of which 71 are active.
The last fiscal year FY 2014/2015, EgyptAir decreased their losses to EGP 718m compared to EGP 3bn during previous FY (2013/2014).
EgyptAir’s cumulative losses recorded EGP 10bn until the end of FY 2014/2015.
An official at EgyptAir said the full rates on European flights have severely decreased over the past two months and recorded at 50%. He also predicted that rates will improve to 70% after the return of British and Russian flights to Egypt.
“The decrease of inbound tourism to Egypt may affect EgyptAir’s plan to record zero losses by the end of the current fiscal year,” the official said.
EgyptAir has been facing a fiscal struggle and a severe decline in its operations since 25 January 2011, which affected its capability to pay the fuel dues to companies’ under the EGPC.