Compass – Muhammad Saad

400 million dinars, the total accumulated losses of Royal Jordanian by the end of the year 2022, based on the financial disclosure provided by the auditor to the company in the Amman Financial Market, and thus the losses exceed the company’s capital, and accordingly, according to the Companies Law, specifically Article No. 266, which states that if the losses of the public shareholding company increase For 75% of the capital, the company must be liquidated unless the general assembly decides to raise the company’s capital or deal with the situation of losses.

The economist, Mounir Dayyeh, commented, asking, Is the liquidation of “Royal Jordanian” the only option available to the Jordanian national carrier? And who is responsible for these huge accumulated losses? How did we reach this result that affects the reputation of investment in Jordan and affects the ability of Jordanian companies In steadfastness, success and continuity in light of the difficult economic conditions that our country is going through.

And the company’s auditor indicated that the Council of Ministers on May 18, 2022 authorized the Ministry of Finance to proceed with the procedures for raising the company’s capital, at a value of 70 million dinars in two tranches, 35 million dinars were received during May 2022, and the rest was received in August 2022.

The need for bold austerity decisions

Diyah said in statements to:compassThe difficult financial situation the company has reached requires a comprehensive restructuring if we want this national company, which bears the name of the Kingdom and the royal crown, to continue carrying the name of Jordan for more than sixty years, and traveled around the world during which it transported tens of millions of passengers.

He added, “The company needs bold decisions in terms of the number of employees, appointments, salaries, benefits, operating costs, a feasibility study for many proprietary stations around the world, huge salary cuts, stopping losing lines, and other measures that need to be implemented to stop their failure.”

Dayyeh stressed that Royal Jordanian is an ancient company that was one of the first airlines in the Arab world, and in the seventies and eighties it reached world capitals that no other Arab airline had ever reached.

He expressed his surprise that despite the increase in property revenues for the year 2022, which amounted to 612 million dinars, with a growth rate of 71% over the year 2021, in contrast, its losses in the same year increased to 79 million dinars, after it transported more than 3 million passengers. All these huge and record numbers that it achieved The company last year, but its losses increased..

Dayeh indicated that this company has a moral value in the hearts of Jordanians, and this name must be preserved and everything necessary should be taken to restore the company’s course in the right direction. Correct the course and take all necessary measures to achieve profits instead of losses and achieve progress instead of retreat.

Fuel prices reinforce losses

On the other hand, the CEO of Royal Jordanian Airlines, Samer Majali, spoke of “an urgent need to review fuel prices for RJ,” and said that “the huge increase in fuel prices affected RJ last year.”

He explained that the Jordanian Petroleum Refinery “monopolises the supply of fuel to the Royal Jordanian at Queen Alia Airport,” noting that “fuel pricing is through an equation in the Ministry of Energy between it and the oil refinery.”

In this regard, Majali said that the fuel supply formula and prices for Royal Jordanian are “vague,” noting that “we are trying to get details on this issue, in light of the huge profits of the oil refinery and nearly 100 million dinars this year.”

He considered that fuel prices in Amman are “the most expensive point in the world for Royal Jordanian and 15% higher than the highest price in the region.”