IATA calls for help to airlines handle coronavirus outbreak

Tuesday, 3 March 2020 00:00 - - {{hitsCtrl.values.hits}}

Middle East airlines lose $ 100 m due to coronavirus
Global airlines to lose $ 1.5 b this year as of now

ABU DHABI (Reuters): Middle East governments should consider providing support to airlines to help them manage the impact of the coronavirus outbreak, which has led to a raft of flight cancellations, the industry’s largest global body said yesterday.

Global airlines have warned of the toll on their business as passenger numbers fall due to the outbreak that first emerged in China in late December and has since spread to more than 50 countries.

Airlines have stopped flights to Iran, where the virus is rapidly spreading, and Saudi Arabia has temporarily banned tourists from 25 countries that have recorded cases the virus.

“The region depends on air connectivity, and support from governments will really help the airlines to get through this difficult period,” the International Air Transport Association’s Vice President for Africa and the Middle East Muhammad Ali Albakri told reporters.

Albakri said IATA was not calling for state bailouts, but that governments could help airlines with their operating costs.

Governments control a number of costs incurred by airlines, such as taxes and landing and overflight fees.

Most Middle East airlines are State-owned. In the past major Gulf carriers have come under scrutiny over allegations they unfairly benefited from State funds, a charge they deny.

Albakri said he did not expect other jurisdictions to criticise support given to airlines due to the coronavirus, known as COVID-19.

Emirates, the Middle East’s biggest carrier, is asking its staff to take paid and unpaid leave to help it manage a “measurable slowdown” due to the virus, Reuters reported yesterday.

Air ticket sales to, from, and within the Middle East are seen dropping over the next few weeks, and airlines in the region stand to lose around $ 100 million in revenue at this stage, AlBakri said.

Middle Eastern carriers, most of which are unprofitable, have stopped most flights to China and cut or reduced flights on other Asian routes.

“Significant additional revenue is at risk to the Middle East carriers if the travel restrictions spread further to the rear of Asia Pacific,” Albakri said.

Roughly 50% of all Middle East airline capacity is flown on services to and from Asia Pacific, he said, highlighting the considerable risk to their business.

Middle East airlines have lost an estimated $ 100 million so far due to the coronavirus outbreak and governments should help the carriers through this “difficult period” IATA official said.

Ticket sales in the region for Middle Eastern airlines are expected to drop in coming weeks and revenues are at risk if travel restrictions in Asia are extended, IATA Vice President for Africa and the Middle East Muhammad Ali Albakri told reporters.

At this stage, global airlines stand to lose $ 1.5 billion this year due to the virus, he said.

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