THE International Air Transport Association (IATA) on Thursday appealed to governments in Africa and the Middle East, to provide emergency support to airlines as a result of coronavirus disease.
Alexandre de Juniac, IATA’s Director-General and Chief Executive Officer, said that the airlines were struggling for survival due to the evaporation of air travel demand as a result of COVID-19.
“Stopping the spread of COVID-19 is the top priority of governments but they must be aware that the public health emergency has now become a catastrophe for economies and for aviation.
“The scale of the current industry crisis is much worse and far more widespread than 9/11, SARS or the 2008 Global Financial Crisis. Airlines are fighting for survival.
“Many routes have been suspended in Africa and the Middle East and airlines have seen demand fall by as much as 60 percent on remaining ones.
“Millions of jobs are at stake. Airlines need urgent government action if they are to emerge from this in a fit state to help the world recover, once COVID-19 is beaten,’’ de Juniac said in a statement.
de Juniac said that extensive cost-cutting measures are being implemented by the region’s carriers to mitigate the financial impact of COVID-19.
He, however, said that due to flight bans as well as international and regional travel restrictions, airlines’ revenues were plummeting.
“With average cash reserves of approximately two months in the region, airlines are facing a liquidity and existential crisis. Support measures are urgently needed.
“On a global basis, IATA estimates that emergency aid of up to $200 billion is required,’’ he said.
IATA, however, proposed a number of options for governments to consider.
IATA suggested: “Direct financial support to passenger and cargo carriers to compensate for reduced revenues and liquidity attributable to travel restrictions imposed as a result of COVID-19.
“Loans, loan guarantees and support for the corporate bond market by governments or central banks.
“The corporate bond market is a vital source of finance but the eligibility of corporate bonds for Central Bank support needs to be extended and guaranteed by governments to provide access for a wider range of companies.
“Tax relief: Rebates on payroll taxes paid to date in 2020 and/or an extension of payment terms for the rest of 2020, along with a temporary waiver of ticket taxes and other Government-imposed levies.’’ (NAN)
– Mar. 19, 2020 @ 14:39 GMT |