Philippine Airlines has been asked to immediately settle a bill of PHP 7.3 billion (US$146 million) or to face a ban at Manila International Airport, its main hub.
The threat came from Filipino President Rodrigo Duterte who recently declared to shut down Terminal 2 of Ninoy Aquino International Airport, which the country’s flag carrier has been exclusively using since 1999, if the airline’s owner, business tycoon Lucio Tan, fails to settle his company’s arrears.
According to the Department of Transportation, PAL’s unpaid navigational fees and other liabilities to the government have so far reached P7.3 billion as of Sept. 26, 2017, payable to the Civil Aviation Authority of the Philippines and the Manila International Airport Authority. The airline’s management immediately indicated to settle PHP 6 billion (US$116.5 million).
In a joint statement issued on Friday, PAL and the DOTr said: “The DOTr has accepted the offer of PAL to pay in full the P6 billion claims of the CAAP/MIAA, and PAL commits to keep all transactions updated and current with the CAAP/MIAA.”
“One of the overriding reasons why PAL agreed to settle is to manifest its trust and confidence in President Duterte’s administration,” they also said.
“PAL assured the government and the travelling public that it will continuously provide its vital airline operations in the service of the Filipino people.”