The economy minister, António Pires de Lima, today stated that the public service obligations of state airline TAP "will always be guaranteed" regardless of whether the state owned a stake or not.
The Economy Minister’s flight of fancy continued, "Flights to Guine-Bissau? Of course the future TAP shareholder must ensure these. Flights to the Azores and Madeira? Of course the future TAP shareholder must ensure these. Flights to Lusophone communities? It's all part of the specification," Pires de Lima told reporters at today's 3rd Franco-Portuguese Conference in Lisbon.
"We will protect these conditions while we own 34% of the capital, and we will protect them even when we do not own any shares, if this eventually happens," said a possibly sober Pires de Lima.
According to the minister, ensuring the public service obligations of the company, "must always be a guaranteed condition for when TAP one day is 100% privatised."
The minister added that only when there is "comfort and confidence in the future TAP shareholder" will it be possible to proceed to the complete privatisation of the airline by the government selling its remaining stake.
The government decided on Thursday to sell 61% of TAP while keeping a 34% stake with 5% being allocated to TAP staff.
These remarkable assurances will either lead to disappointment as a new owner decides which routes it want to fly and ditches the ‘public service’ obligations, or to a depressed price for the shares if the routes have to stay as part of the deal.
Any offer price for 61% TAP will reflect the obligation from the new owner to keep routes open that may be unporfitable.
This will not be in the best interests of the Portuguese taxpayer who owns the airline through state company Parapublica.
Pires de Lima's business background, though a welcome additon to the ranks of ruling politicians who have never had a commercial induction, would lead him to conclude that a sale with a host of operating conditions is probably anti-competitive and certainly likely to be ignored by potential buyers including Frank Lorenzo, Gérman Efromovich, David Neeleman and Miguel Pais do Amaral.