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Last Updated: Friday, 21 May, 2004, 10:27 GMT 11:27 UK
End of the road for Tonga airline
Royal Tongan Boeing
Royal Tongan Airlines has been flying for nearly 20 years
The tiny island kingdom of Tonga has closed its national airline after the carrier ran out of cash for repairs.

The move follows a mechanical failure which grounded Royal Tongan Airlines' last remaining aircraft this week.

The cash-strapped carrier has been facing an uncertain future since April, when its only aircraft serving international routes was repossessed.

Its collapse comes just before the tourist season, threatening an important source of revenue for Tonga.

Foreign tourists depend on Royal Tongan to fly them to resorts clustered on the northern islands of the Tongan archipelago, some 300 kilometres from the capital, Nuku'alofa.

Grounded

New Zealand and Australian airlines, which already control much of the international traffic to and from Tonga, are now expected to take over the country's domestic routes as well.

Tonga
Royal Tongan Airlines traces its origins back to 1985, when the kingdom bought a small fleet of aircraft and opened air routes between some of the 169 islands that fall within Tonga's territory.

International services began the following year with direct flights to American Samoa, and were later extended to Sydney, Auckland, Honolulu and Los Angeles.

Tongan Royal Airlines is believed to have racked up losses of about $20m (12m).

The airline's failure represents a further setback for the Tongan economy, which was rocked last year when a state-backed fund lost millions in ill-fated overseas investments.

The investment fiasco cost the equivalent of a year's tourism earnings and eradicated a financial cushion that could have been used to bail out Royal Tongan Airlines.

Earlier this year, Tonga settled an acrimonious court case with the fund manager, who also worked as the official jester to the court of King Taufa'ahau Tupou IV.




SEE ALSO:
Cash crunch grounds Tonga airline
29 Apr 04  |  Business
Tonga court jester 'to pay $1m'
19 Feb 04  |  Business
Tongan court jester faces trial
11 Aug 03  |  Business
Tonga sues over jester's huge losses
11 Jun 02  |  Asia-Pacific
Tonga's jester has last laugh
06 Oct 01  |  Asia-Pacific
Country profile: Tonga
01 Nov 03  |  Country profiles


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