France, EU reach good deal on Air France aid, Le Maire says

The French government and the EC have reached an agreement in principle on fresh financial support for Air France, which has been hurt by a drop in air travel since the start of the pandemic, Finance Minister Bruno Le Maire said Sunday. “It’s very good news for Air France, it’s very good news for the whole French aviation sector,” Le Maire said. “It was a long and difficult negotiation, but I think we’ve reached a good agreement” with EU Competition Commissioner Margrethe Vestager. The accord is “fair and proportionate,” he said, adding that the carrier would have to give up fewer than the 24 airport takeoff and landing slots at Paris-Orly airport wanted by the Commission in return for state support due to competition concerns. France and the Netherlands own a combined 28% stake in Air France-KLM. The countries have been in talks for months on a funding plan after granting the carrier E10.4b in direct loans and state-backed guarantees last year. The carrier, whose net debt ballooned to E11b at the end of 2020, has said it’s planning to raise equity and quasi-equity. The airline’s board will meet on Monday to validate the principle of the accord, Le Maire said. He declined to give details of the amount of support or number of slots to be given up ahead of the meeting. The French government is coming to Air France’s aid as it considers the carrier to be strategic for the country, with tens of thousands of jobs at stake, Le Maire said. However, the airline must improve competitiveness, reduce carbon emissions and return to profit, he added.<br/>