Airlines given $123 b in state aid: industry

Governments have provided airlines $123b to help weather the coronavirus storm, the global aviation industry said Tuesday, warning though that the assistance was adding to surging debt in the industry. The IATA warned that the sector's debt was expected to rise to $550b by the end of the year -- an increase of 28%. While governments have in many cases come to the rescue of their countries' embattled airlines, IATA pointed out that $67b of the $123b committed so far would have to be repaid. The remainder of the state aid consists of wage subsidies ($34.8b), equity financing ($11.5b), and tax relief/subsidies ($9.7b). "Government aid is helping to keep the industry afloat. The next challenge will be preventing airlines from sinking under the burden of debt that the aid is creating," said IATA CE Alexandre de Juniac. IATA highlighted regional disparities, saying that airlines in North America had been promised aid worth 25% of their 2019 revenues; in Europe, the figure was 15% and in the Asia-Pacific region, 10%. However, in Africa and the Middle East, that was 1.1% and in South America, just 0.8%. IATA pointed to bankruptcies in Australia, Britain, Italy, Thailand and Turkey where governments had not stepped in strongly enough.<br/>