Indonesia's state-run airlines suspends flights

Suffering from serious management failures that paralyzed its operation, Indonesia's state-run Merpati Nusantara Airlines (MNA) announced suspension of its flights serving to all destinations effective late last week with tentative service resuming possibly later this week. "Merpati (MNA) has come to a point that makes us incapable to carry out operation as it supposed to do," the firm's operational director Capt. Daryanto said in a statement issued on Monday. He said that such a condition was caused by complexity of problems in MNA at this moment that comprised of decreasing passenger numbers, mounting debts and decreasing public and travel agents to the firm that serves flights mostly to remote areas in eastern region of the vast archipelago country. Flight suspension was imposed after state-run oil firm, Pertamina, refused to supply fuel for planes operated by MNA after the airlines firm has exceeded its maximum debt limit. MNA's debts on fuel supply to Pertamina amounts to 165 billion rupiah (about 13.6 million U.S. dollars), and the state-run oil and gas firm announced to only receive cash upon fuel purchase by MNA. In total, the state-run airlines that began operation since 1962, has an obligation of 6 trillion rupiah (about 492 million U. S. dollars) consisted of ticket refunding for passengers failed to fly, obligation to airport operators, staff salary and fuel expenses. The decision to suspend flights temporary was taken after it carried out several measures aimed at saving the firm's operation, from reducing the number of destination to trimming down flight frequency. Daryanto said those moves turned out to be unfruitful as MNA failed to get fuel supply in several airstrips in the region. Efforts to save operation of MNA have been conducted by State- owned Enterprises (SoE) Dahlan Iskan, which include divesting two of MNA's subsidiaries, Merpati Maintenance Facility and Merpati Training Center recently. The process was still progressing at the moment. Indonesian Transportation Ministry Spokesman Bambang Ervan said earlier that MNA was spared one month to resume its flights service. If it fails the ministry would revoke its flight permits. As of December last year, the firm operated a total of 25 planes from various types, including Boeing 737 series, De Havilland DHC-6 Twin Otter and MA60 Xian. The latest type of plane dominates MNA's fleet. Suspension of MNA flights was somewhat ironic as Indonesia sees enormous growth of flight passengers in recent years. More than 81. 36 million passengers were recorded in 2012, higher than 60.19 million in 2011, 19 and 17 percent growth respectively.