The trade group of the world’s airlines is calling on governments in the Asia-Pacific region to extend emergency support to the industry devastated by the new coronavirus disease (COVID-19).
The International Air Transport Association (IATA) said it wrote the heads of governments in the region to provide financial support as carriers “fight for survival due to the dramatic loss of air travel demand due to the COVID-19 crisis.”
“For airlines, it’s apocalypse now,” IATA director general and CEO Alexandre de Juniac said in a statement.
IATA reached out to 18 governments, including the Philippines, Bangladesh, India, Japan, Malaysia, Pakistan, Republic of Korea, Thailand and Vietnam.
IATA said the industry needed a financial lifeline of $200 billion. At risk are 2.7 million airline jobs on top of millions more that support the sector.
The crucial passenger business, in particular, had collapsed with flight restrictions and warnings against nonessential travel.
“There is a small and shrinking window for governments to provide a lifeline of financial support to prevent a liquidity crisis from shuttering the industry,” de Juniac said.
IATA proposed state-backed measures such as direct financial support, loans or loan guarantees and tax breaks. It said the COVID-19 crisis would wipe out some $88 billion in revenue and cut passenger demand by 37 percent this year versus 2019.
This is based on a scenario where severe restrictions on travel are lifted after three months, followed by gradual recovery, it added.
Roberto Lim, vice chair of the Air Carriers Association of the Philippines Inc., earlier warned that flight suspensions could trigger a so-called cash drain as revenues vanish while airlines return billions of pesos in refunds.
The country’s three major airline companies—Philippine Airlines, Cebu Pacific and AirAsia Philippines—have halted all passenger operations after wider quarantine measures were ordered by the Philippine government to contain the spread of COVID-19.
The Philippine government’s economic team announced it would mobilize government-owned or controlled corporations “to assist airlines and the rest of the tourism industry.”
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