tailieunhanh - Finance in Airline (Third Edition): Part 2

Continued from part 1, part 2 of the document presents the contents: airline privatisation, airline financial planning and appraisal, risk management: foreign currency and fuel price, aircraft leasing, aircraft securitisation, airline bankruptcy, industry financial prospects. To grasp the details of the content invite you to consult the ebook. | Chapter 7 Airline Privatisation The trend towards the privatisation of government owned assets gathered pace during the 1980s as part of overall economic programmes introduced by more capitalist governments. This was encouraged by aid agencies such as The World Bank the Asian Development Bank and the European Bank for Reconstruction and Development. Policies pursued by the latter became increasingly influenced by the USA their major donor country. The justification for privatisation was both strategic and financial. Strategic reasons encompassed Reducing the involvement of the state in the provision of goods and services. The promotion of economic efficiency. The generation of benefits for consumers. The promotion of an enterprise culture. The achievement of wider share ownership. Of equal or even greater importance were often the financial reasons governments welcomed these sources of cash with which to reduce their budget deficits allow room for reducing taxes or shift the financial burden to the private sector. However it is not entirely obvious that an airline would be a financial burden once it had been prepared for privatisation. Furthermore while these policies may have looked attractive in the short-term they might in some cases have resulted in fire sales of quality assets at low prices which effectively transferred wealth from the population as a whole to those who were lucky enough to be allocated shares in the newly privatised company. This chapter focuses on the financial aspects of airline privatisation. Equally important but beyond the scope of this book are the economic aspects and the preparation before privatisation. This is discussed in some depth by Doganis with particular reference to Olympic Airways an airline which he chaired during its preparation The average government stake in the largest 25 international airlines was 28 per cent in 1996 19 per cent in 2001 and 16 per cent in 2005 ranked and weighted by international RTKs in each