Portugal's TAP may need more aid than planned in 2021, minister says

Portugal may have to provide more than the E500m it budgeted for ailing airline TAP this year due to the worsening COVID-19 pandemic, its finance minister said. Asked how much more the Portuguese government expects to spend on TAP this year, Joao Leao told Sunday’s Jornal de Negocios: “That is still being analysed”. “The situation of TAP is very demanding ... that amount may have to be reconsidered because at the moment the pandemic is having a much stronger impact than expected,” Leao said. In December, a government plan to rescue TAP proposed 2,000 job cuts by 2022 and pay cuts of up to 25%, while the airline would need around 2 billion euros in extra funds with state guarantees to cover its financing needs until 2024. The redundancies may be lower if the European Union accepts an agreement in principle last week between the leaders of 15 unions and TAP’s board. However, if the EU executive rejects Lisbon’s proposal, TAP would have to immediately repay a E1.2b rescue loan agreed in June, which could lead to its insolvency.<br/>