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| My Orchids, Unsecured Non Interest Bearing Oncidium. |
Cargolux – Qatar Airways:
Transparency in a sandstorm?
Last week was a
target-rich environment for those following Cargolux. Cargolux’ Ex, after the
broken marriage of 2011, seems to be scheming a vengeful plan. Thanks to
unlimited budgets, Qatar Airways will dry out and smoke out poor CV that has to
live on bare earnings. The European Commission would even get angry, if the
Luxembourg government would help CV out, in order to survive the QR
cannibalism.
Unlimited budgets don’t
rely on earnings but on unlimited money from elsewhere. That means it comes
either from a drunken sailor, or a charity, or a mindless investor, or a
government. In the case of a government, that money would be called a subsidy.
QR is really miffed at
that type of insinuation, that it is a subsidized enterprise. In order to stop
the gossip, it issued a “Consolidated Financial Statement” for full
transparency, and available online. I gladly share my findings here:
Oops! This is what you
may get too:
The www.qatarairways.com page
isn’t working
www.qatarairways.com redirected you too many times.
Try:
- Reloading
the page
- Clearing
your cookies
ERR_TOO_MANY_REDIRECTS
So now what? Let’s go to
Loadstar and at least get a summary explanation about the transparency gig. The
relevant article is: “Qatar
Airways reveals financials in transparency bid 'to kill allegations of state
subsidy'. Try the orange link in paragraph 2: 61-page statement.
If you are unsuccessful too, we’ll tell His Highness, and He will kick ass in
the IT department.
In the meantime, out of
frustration, allow me to just look at the Loadstar’s article to find out about
transparency. As you know the allegations of QR being massively subsidized (7
billion in 2015) has been a topic for some time and is resented as aggressive
and unfair practice, in a field where others can’t get subsidies.
Back to the article,
where it says: ‘The results show the
company issued 473,395,000 shares, worth QAR10 each, to the government as
payment for “shareholder advances”, which are non-interest bearing and
unsecured.’
Alright then: QR has one
shareholder since 2013. People agree to call that shareholder the government.
If it were one person, this argument here would be moot. A private person can
put unsecured and non interest bearing money and lose it wherever. But it is the government, the sole shareholder
buying all those shares at 10 QAR each. That government owned 100% before
buying these shares. After it bought for close to 5 billion QAR, it still owns
100%, unless you can own 200%.
That money is called “shareholder
advances” which are non-interest bearing and unsecured. In other words, it is
free money, the government graciously waives interest it would have to pay to
itself, and it is unsecured (no guarantee to see it back). A gift. So the owner
basically shores up the cash register. Shareholder advances are a nice
euphemism for subsidies.The Luxembourg Pilot's Association ALPL could not be duped, Mr Forson the new CEO of CV knows better, only Minister Bausch sees no harm. He also thinks that there is no difference between Luxembourg airport with 5th Freedoms granted to QR, and Liege airport. Don't we all hope that this decision maker is right?
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