15 May 2004

Tonga airline likely to axe overseas flights

8:23 am on 15 May 2004

The Kingdom of Tonga says it's seeking to shut down permanently the international services of its state airline.

The Boeing 757 passenger jet which Royal Tongan Airlines used for international flights was repossessed and grounded at Auckland International Airport last month.

A Tonga minister, Clive Edwards, is reported as saying that the financial problems of Royal Tongan Airlines are so severe that flights overseas cannot resume.

Mr Edwards says it's likely the airline will appoint a liquidator for international services.

He says it's now a priority to work out severance pay for up to 200 employees of the airline.

He says domestic flights in Tonga will continue, with the government looking at funding from the private sector.

A Royal Commission of Inquiry on the situation of the airline heard from an Australian aviation specialist, who recommended that the airline be placed under an administrator.

Clive Edwards says Tonga's laws don't provide for this, so Cabinet will be asked to put the airline into liquidation.