IATA is calling on governments around the world to “avoid an industry calamity” in the air transport sector resulting from the global spread of COVID-19 by offering financial relief measures such as direct financial support, loans and tax rebates or suspensions.

Speaking at a 17 March media briefing, IATA CEO Alexandre de Juniac first emphasized that the global air transport industry was “responsibly responding” to the worldwide pandemic. However, he went on to say, “The measures that governments have introduced to restrict travel are shrinking the size of passenger operations. That is also removing significant cargo capacity from the system – capacity that is vitally needed to keep supply chains going, including the delivery of critical medicines and medical equipment.”

“In these extraordinary times, we have also asked governments to take some extraordinary measures,” he said. 

He then outlined three ways in which governments could use financial means “to avoid an industry calamity”. They were:

  • Direct financial support for carriers to compensate for reduced revenues, and therefore support liquidity due to travel restrictions imposed as a result of COVID-19. 
  • Loans, loan guarantees and support for the corporate bond market by the Government or Central Bank, either directly to the airline or to commercial banks that may be reluctant to extend credit to airlines in the present situation in the absence of such a guarantee.
  • Tax relief: Rebates and/or suspensions on all employer-imposed payroll taxes paid to date with an ongoing review for the rest of 2020, along with a temporary waiver of ticket taxes and other Government-imposed levies.

Recognizing that there was no “one size fits all solution,” de Juniac said IATA will contact governments to “alert them to the dire situation of the industry and get them moving – in the circumstances of their country.”

“Time is of the essence,” he urged. “Governments cannot take a wait-and-see approach. We have seen how dramatically the situation has deteriorated globally in a very short time. They must act now and decisively.”

He closed by saying, “Prioritizing air transport – helping airlines survive through these dark times – will position the world for the eventual recovery…Aviation is a resilient industry. With decisive action by governments we can get through this crisis and keep the world connected.”

 

Image Credit | iStock

 

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