P8.6 billion monthly stimulus needed to keep PH aviation industry afloat

Aviation Updates Philippines – The Air Carriers Association of the Philippines (ACAP) said Monday that the Philippine aviation industry needs around P8.6 billion in government subsidies monthly to survive as the COVID-19 pandemic wrecks havoc in day-to-day operations.

ACAP Vice-Chairman Roberto Lim emphasized that the aviation industry, one of the most affected sectors at this point, will possibly lose up to $4.9 billion, according to projections from the International Air Transport Association (IATA).

To help airlines stay afloat, the ACAP requested around P6.8 billion for working capital, P1.3 billion for wage subsidies, and approximately P500 million for operational expenses (charges paid to the Civil Aviation Authority of the Philippines (CAAP) and Manila International Airport Authority (MIAA) for landing, take-off, and gate fees).

"Any extension of the enhanced community quarantine (ECQ) will further increase the losses. And if we move to a scenario wherein restrictions will be relaxed, we feel that there will still be challenges," Lim said.

Although some airlines can already resume flights from secondary hubs, such as Tacloban and Puerto Princesa, Lim said they worry about how the local government units will respond to receiving passengers noting that health care facilities become less available at these areas.

"They do not have the public health infrastructure to contain any introduction of infection."

He also mentioned that there are around 25,000 workers across airlines in the Philippines. To recall, there have been retrenchments and lay-offs from airlines in the country while they continue to bleed financially with operations at a standstill.

"But if you add the associated entities that support the aviation industry, including hotels... it is estimated by IATA that there are 500,000 jobs that are at stake," Lim added.

Around mid-April, IATA warned that airlines globally will lose $314 billion given the slumping air travel demand around the world. Of that figure, the Asia-Pacific region accounts for $113 billion of the losses.

“We have never seen a downturn this deep before,” IATA Director General Alexandre de Juniac said. The statistics from the previous months show that the air travel industry points to a slow recovery.
Cebu Pacific Airbus A330