Gov't restructuring 'uncompetitive' airliners

The government will lead the restructuring of the debt-ridden aviation industry, leaving "uncompetitive" low-cost carriers unqualified to receive coronavirus relief funds. Earlier this month, the Korea Development Bank (KDB) decided to raise a 40t won ($33b) virus relief fund in response to growing calls for the government to play a bigger role in salvaging companies and key industries hit hardest by the pandemic. The state-run lender and the financial authorities picked the aviation industry as the first beneficiary to receive special funding, as the potential fallout from bankruptcies could bring a wider-than-expected shock to the economy. The nation's nine low-cost carriers welcomed the decision amid hopes to receive financial aid at a time when most of them are suffering serious earnings setbacks after international flights were suspended due to the COVID-19 pandemic. But the state-run lender and the government have not expressed "blind faith" in the sagging airliners, instead introducing a series of tight standards so that only a few will enjoy the financial relief. According to the requirements from the authority, only Jeju Air and Air Busan are eligible to receive funds out of the nine domestic low-cost carriers, while seven others have to come up with cost-cutting self-rescue measures to tackle the ongoing crisis. Korean Air and Asiana Airlines, the nation's two major airliners, are also expected to receive funding.<br/>