PH Airlines Hope for COVID-19 Relief with Emergency Government Loans

Local airlines affected by novel coronavirus pandemic hope to access emergency government loans as they prepare to cancel thousands of flights after the Duterte administration ordered a month-long lockdown of Metro Manila .

Roberto Lim, vice president of the Air Carriers Association of the Philippines Inc. (Acap), told the Inquirer in an interview on Friday (March 13) that the financial support could come in the form of low-interest loans of the State-run Development Bank. from the Philippines.

Emergency loans will help domestic airlines tackle ‘cash drain’ as people demand refunds or avoid flying altogether, costing Philippine Airlines, Cebu Pacific and AirAsia Philippines billions of pesos in losses of income in the first few months of 2020 alone.

“It’s really bad, people don’t want to fly anymore,” Lim said.

“If you look at the sources of revenue for airlines, a lot of it comes from the domestic market,” he added.

“The growth of the Philippine aviation industry has taken place at the national level,” he said.

While praising the efforts to contain the virus, Lim said an emergency lending option would help send a strong message of support as airlines face mounting financial losses.

President Rodrigo Duterte on Thursday announced strict restrictions on land, air and sea travel to and from Metro Manila from March 15 to April 14 to control the spread of the new virus, which has caused the COVID disease. -19. The virus, which first appeared in China, has killed more than 4,700 people worldwide, including five in the Philippines.

This is hitting the airline industry hard, as many see Manila’s Ninoy Aquino International Airport (Naia), located in the restricted area, as their main hub.

Naia handled more than 47 million passengers in 2019, representing around 80% of all air traffic in the country. About half of that volume was made up of domestic travelers, according to data from the Manila International Airport Authority.

Philippine Airlines, Cebu Pacific and AirAsia Philippines operate some 418 domestic NAIA flights per day, airline spokespersons said Friday. That means nearly 13,000 flights for the duration of the lockdown.

The impact of COVID-19 on the airline industry was felt in early February after a travel ban was imposed on China. Global demand has also suffered as travelers postponed their plans for fear of contracting the disease.

On February 28, Philippine Airlines announced 300 job cuts after reporting years of losses, indicating the precarious financial situation of some local carriers as we enter 2020.

The Philippine Civil Aviation Authority and the Manila International Airport Authority (MIAA) agreed last week to delay the collection of charges such as landing and navigation charges to ease the burden. financial pressure on airlines. Lim said earlier that the fee is around 6 billion pesos per year.

Published by the BST

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