The Indonesian authorities drafted a 1$ billion rescue plan for the national airline, Garuda, to prevent it from collapsing due to the coronavirus crisis

The plan was announced by a government official on May 11, 2020. It includes a bridge loan of up to $500 million, and a restructuring proposal of $500 million sukuk (Islamic bonds), Deputy State-Owned Enterprises Minister Kartika Wirjoatmodjo told Bloomberg. “Garuda remains a good company with bright prospects,” said the minister, adding “its business will remain robust after the outbreak ends.”

Despite reducing the salaries of its employees to alleviate the impact of the coronavirus crisis, Garuda was at risk of not paying a series of bonds maturing in June 2020.

The Indonesian state holds nearly 61% of the capital of Garuda. Along with its subsidiary Citilink, Garuda Indonesia operates a fleet of more than 200 aircraft.

On May 9, 2020, a Jakarta court sentenced Emirsyah Satar, former CEO of the Garuda group, to eight years in prison for a corruption case linked to the purchase of parts from Airbus and Rolls Royce. He was found guilty of receiving bribes in exchange for the acquisition of Airbus A320 and A320 aircraft and Trent 700 engines by the airline. In 2017, Rolls Royce settled probes over large-scale bribery across three continents with an $809 million payment.

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Rolls-Royce announced that it has entered into a Deferred Prosecution Agreement (DPA) with the UK’s Serious Fraud Office (SFO) with the approval of the President of the Queen’s Bench Division (The Right Honourable Sir Brian Leveson) and published by the SFO. The company has also reached a DPA with the US Department of Justice (DoJ) and a Leniency Agreement with Brazil’s Ministério Público Federal (MPF). These agreements relate to bribery and corruption involving intermediaries in a number of overseas markets, concerns about which the company passed to the SFO from 2012 onwards following a request from the SFO.
 

In December 2019, the CEO of the airline was sacked after using the delivery of a brand new Airbus A330-900 to smuggle luxury items, including a Harley Davidson motorcycle.

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Garuda Indonesia CEO to be sacked over smuggled Harley Davidson
Garuda Indonesia CEO Ari Askhara could be fired after being accused of  using the airline’s Airbus A330-900 delivery flight to smuggle Harley Davison motorcycle avoiding millions in taxes.