Japan’s Government Vows to Back JAL

Japan’s prime minister and transport minister on Wednesday said the government was ready to support Japan Airlines, aiming to dispel worries over the viability of the loss-making carrier, according to reports. The public statement of support came in the wake of continuing business problems JAL.

An Australian insurance company has refused to offer a guarantee to refund JAL’s tickets in case the airline goes bankrupt, according to a JAL spokesman. A British credit company, meanwhile, has stopped accepting transactions to issue JAL tickets, according to a transport ministry official.

“Recent media reports about JAL have fueled concerns,” Transport Minister Seiji Maehara said Wednesday at a news conference. “I believe JAL still has more than enough reserve power, but in case the worst happens, the government will back it up.”

Prime Minister Yukio Hatoyama told reporters that Japan would be willing to step in if the company were to fall into trouble, but that he didn’t expect it to come to that, according to reports.

“I hope JAL can rebuild itself on its own, and I think it can,” said Hatoyama, leader of the Democratic Party, which took power in a landslide election last month, defeating the long-ruling Liberal Democratic Party.