SIA & Garuda Indonesia sign agreement to explore more areas for cooperation

An Indonesian official previously said Garuda was 'technically bankrupt'.

Jean Chien Tay | November 26, 2021, 06:03 PM

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Singapore Airlines (SIA) and Indonesia's flag carrier -- Garuda Indonesia -- announced the signing of a Memorandum of Understanding (MoU) in a joint media release on Nov. 26.

According to the press release, the MoU will allow both carriers to explore a wide-ranging commercial partnership, which could provide their customers with additional options and an enhanced travel experience.

The agreement was signed by SIA chief executive officer (CEO) Goh Choon Phong and Garuda Indonesia president and CEO Irfan Setiaputra on Nov. 26.

It coincides with the upcoming launch of a quarantine-free Vaccinated Travel Lane (VTL) between Indonesia and Singapore on Nov. 29.

More potential cooperation

The scope of the collaboration between SIA and Garuda includes the potential alignment of frequent flyer programmes, joint marketing activities, and initiatives to promote inbound tourism into Indonesia, subject to regulatory approval.

Previously on Oct. 1, both airlines reactivated their air connectivity partnership arrangement between Singapore and Bali, Jakarta, and Surabaya, the press release said.

Garuda also commenced flights network connectivity on SIA’s services to London on the same day and plans to codeshare on SIA’s flights to Mumbai from Jan. 1, 2022.

Goh said SIA and Garuda have a "strong and long-standing relationship", and the agreement will allow both airlines to leverage each other's strengths to provide customers with more options and a better travel experience.

"It would also enable us to work closely together to support initiatives that facilitate and grow tourism and economic activity as borders reopen," he added.

Garuda CEO: "great opportunity"

Meanwhile, Garuda's president and CEO Irfan Setiaputra referred to the cooperation as a "great opportunity", while adding that Garuda is the first Indonesian airline that leverages the VTL in this collaboration with SIA.

He further expressed the airline's commitment to supporting economic and tourism recovery by participating in efforts to ensure the "readiness" in air-transport infrastructure.

Explore new opportunities

According to the press release, SIA and Garuda are committed to exploring new opportunities in the air freight segment, as well as cooperation in maintenance, repair, and overhaul activities.

To support increased air connectivity to Indonesia, Singapore, and Southeast Asia, both airlines will also explore additional airline connectivity partnerships in their networks.

VTL with Indonesia

Vaccinated Travel Pass (VTP) applications for Short-Term Visitors and Long-Term Pass Holders have already commenced on Nov. 22.

Travellers under the VTL are not subjected to Stay-Home Notice (SHN) upon arrival. Instead, they will be required to produce a negative Pre-Departure Test taken within two days before departure and undergo an on-arrival PCR test.

Garuda "technically bankrupt"

Previously, Indonesia's Deputy Minister for State-Owned Enterprises Kartiko Wirjoatmodjo said Garuda Indonesia was “technically bankrupt”, Jakarta Globe reported.

He added that corruption and Covid-19 were both contributing factors to Garuda's woes.

According to Bloomberg, the Indonesian airline is working to restructure its debt of US$6.3 billion (S$8.6 billion), and the government is open to allowing private investors to take a majority stake in the company in exchange for funds to repay its debts.

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Top image via Singapore Airlines website & Garuda Indonesia website