PAL settles P283-M past obligations

Manila, Philippines -  The Philippine Airlines (PAL) has remitted to the Civil Aviation Authority of the Philippines (CAAP), P283 million as payment for navigational and landing charges in 2011.

CAAP Director General Ramon S. Gutierrez, said the flag carrier is in talks with Abner Bondoc, CAAP chief financial officer, on how to settle the rest of the P5.2-billion back accounts that PAL has incurred for more than a decade.

“The present management of the country’s flag carrier paid the outstanding fees and charges for year 2011 as a gesture of goodwill and PAL’s commitment in developing trust and confidence between the regulator (CAAP), and the regulated (PAL),” Gutierrez said.

PAL chairman and CEO Ramon Ang had promised to help the CAAP regain category 1 status, by providing additional fund in the form of debt settlements to help finance the salaries of technical personnel.

Bondoc said CAAP continues to reconcile PAL accounts starting in 1993, when the airline first fell into private hands under then PLDT chairman Antonio “Tonyboy” Cojuangco and purchased by tycoon Lucio Tan in 1998.

“When Mr. Ramon Ang took over the leadership of PAL much headway had been achieved in the negotiations” Bondoc said.

The payment is part of the flag carrier’s promise to help the aviation sector regain its category 1 status. It is also a measure of the carrier’s strategy for expansion.

Last month, Ang committed the resources of PAL to help the government in its effort to regain category 1 status.

The International Civil Aviation Organization, the Federal Aviation Administration and the European Union have found significant safety concerns that they felt CAAP rectify before NAIA could be given back its category 1 status.

With the downgrade, PAL has been prevented from expanding its current routes in the US, while the EU has banned all Philippine carriers over European skies.

With an expanded fleet, PAL said it would resume flights to Europe and bolster US services.