Sydney: State-owned Air Vanuatu has suspended international flights on Thursday as the Pacific island’s government plans to launch bankruptcy proceedings.
Air Vanuatu is one of the few airlines serving the South Pacific islands with international flights, and the company’s collapse could affect foreign tourism revenue.
According to the Australia-Pacific Islands Business Council, tourism is a key driver of Vanuatu’s small economy, accounting for a third of the country’s economy.
Accountants from Ernst & Young landed in the capital, Port Vila, the day before to review options for airlines and government officials.
The carrier said future international flights serving Australia, New Zealand, Fiji, Papua New Guinea, New Caledonia and the Solomon Islands have been canceled or are under review.
The airline said it was operating in “difficult conditions”.
The airline’s online update said two Boeing 737s and an Airbus A320 were grounded and needed engineering work while being limited by international spare parts.
Vanuatu’s tourism department said it was liaising with airlines and the government.
Air Vanuatu scraps flights as insolvency looms
