Indonesia court extends Garuda's debt restructuring process

National airline struggles to avert bankruptcy as creditors demand payment

The COVID-19 pandemic has hit Garuda Indonesia particularly hard, with the airline struggling to stay solvent. © AP

SHOTARO TANI, Nikkei staff writer

January 21, 2022 18:34 JST

JAKARTA -- A court in Indonesia on Friday extended embattled national airline Garuda Indonesia's suspension of debt payment obligations for 60 more days, as the company works to restructure its finances and stave off possible bankruptcy.

The state-owned carrier is negotiating with creditors under a suspension mechanism known as PKPU, which it entered after a local information technology company took it to court for unpaid debts.