VietNamNet Bridge –Troubled Indochina Airlines has revealed it has successfully come to a debt repayment arrangement with partners.

A ticket booth of Indochina Airlines

This latest news follows a warning from the Civil Aviation Administration of Viet Nam that the Government would revoke its license if creditor problems continued.

The carrier currently owes large sums to aviation fuel, cooking and airport service suppliers and has faced financial difficulties since its launch in November 2008.

Now, a statement from the airline has revealed creditor deals aimed at debts being cleared by the year-end. The news means licensed flights can now be continued.

In addition shareholders have agreed to inject a further VND 150billion ($8.3million) to help solve financial problems and create some stability.

The newly added second Boeing 737-800 will start operating on October 22 between HCMC and Hanoi.

It means increasing flights from two to four a day while also reopening the previously suspended route between HCMC and Da Nang.

The airline’s financial restructuring plans also point to increasing the fleet to four in the second quarter of next year. This move would see it further expanding operations and adding more routes.

Difficulties to date have been blamed on the global recession as well as stiff competition from state-run Vietnam Airlines and Jetstar Pacific, in which Australian Qantas Group has a 27 percent stake.

The carrier has operated 1,900 safe flights with 240,000 passengers and reached a maximum capacity of 80 percent in the first eight months, according to the statement.

Three private airlines have been licensed in Vietnam, but the two others – Vietjet Aviation Co. and Mekong Aviation Co. – have not launched their commercial flights.

The government has stopped the licensing of new airlines until 2015 because of the country’s limited airport facilities and availability of skilled personnel.

Meanwhile no official figures on Indochina’s losses have been released.

VietNamNet/TN