Friday, May 1, 2020

Begging Bowls are Out for Global Government Aid as Airports and Carriers Ask for Assistance

Any Upturn in Freight Will Not Match the Loss of Passenger Flights
Shipping News Feature

WORLDWIDE – The begging bowls are out in all sectors of the economy as many companies struggle to face a post-pandemic future, and none is likely to face a bigger challenge than the global air transport industry. Currently passenger flights have virtually dried up and nobody imagines that any upturn in freight carriage as aircraft are converted to carry cargo, is going to redress the revenue balance.

This week the Airports Council International (ACI) and the International Air Transport Association (IATA) have come together to call for governments to quickly grant financial relief to assist airport operators and airlines during the unprecedented Covid-19 crisis and support the essential connectivity they say the industry will provide for economic recovery.

The two organisations say the industry is united with governments around the world in efforts to stop the spread of the virus, and, in the face of massive government imposed travel restrictions, the industry is doing all it can to maintain air cargo operations vital to supporting global supply chains, including medical shipments critical to fighting Covid-19.

With the number of passenger flights falling off a cliff, revenues are being drastically reduced, beyond the ability of even the most extreme cost-cutting measures to mitigate. Airports and airlines continue to face a financial liquidity crisis the like of which they have never known before. This unprecedented situation is undoubtedly putting millions of jobs directly at risk.

According to figures released by Aviation Benefits Beyond Borders (ABBB) the aviation industry supports 65.5 million jobs around the world, including 10.5 million people employed at airports and by airlines, and supports $2.7 trillion in world economic activity. ACI and IATA are caling for taxation relief, including alleviation of payroll taxes, corporate taxes, concession fees or other government incomes from the industry plus loans, loan guarantees or direct support to maintain financial liquidity across the aviation ecosystem.

The two groups say that although some governments have recognised the urgency of action, time is running out for others to provide the necessary financial relief to keep the whole industry viable and ready to support a balanced recovery, including aid for ground handlers and other service providers at airports. ACI World Director General Angela Gittens, commented:

“The financial impact of the current crisis is unlike anything we have ever seen and requires urgent action by governments to assist the aviation industry to protect jobs, ensure essential operations, and plan for recovery. Urgent tax relief and direct financial assistance that is to the benefit of the entire aviation ecosystem is needed to help preserve millions of jobs, protect essential operations, and foster a balanced recovery. Preserving the continuity of operations for airports and airlines and protecting aviation jobs today will result in a faster economic recovery tomorrow.”

The view of the global airports representative was echoed by that of the carriers, with IATA’s Director General and CEO Alexandre de Juniac, saying the situation could not be more dire, adding:

“Governments will depend on aviation to be ready to lead an economic recovery when this pandemic is behind us. Governments must act now with financial lifelines that only they can provide for airlines and airports to see them through these extraordinary times. Airlines and airports are in this together. The more financially stable our airport partners are, the more they can help the industry to drive a recovery in air travel that will jump start the global economy.”

Photo: When is the next time you will get that view? (Image courtesy of the European Parliament).