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State aid for airlines - the story so far

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State aid for airlines - the story so far

Despite IATA warning that airlines globally are facing losses of  $314 billion in 2020, a 55% decline compared to 2020, the US government’s $58 billion CARES package, is by-far largest aid deal so far, and even there voices are being raised that environmental and worker’s rights issued should be linked to supporting the aviation sector.

Below is a list of the state aid that has been offered so far, Airline Economics will update it as and when it changes

United States' Senate has approved $58billion in loans and loan guarantees for US passenger airlines and cargo carriers

So far airlines and the US Treasury have reached agreement on $25 billion of the package 

The figure breaks down as; American ($10.5 billion), Delta ($5.4 billion) United ($4.95 billion), Southwest ($3.3 billion, Alaska ($881 million, Jet Blue), ($936 million), Spirit ($335 million)Hawaiian ($289 million), Allegiant ($172 million), SkyWest ($438 million), and Mesa ($76 million)

US airports have received a $1.18 billion CARES aid package

Australia has given a A$715 million (US$430 million) aid package of refunds and forward waivers on fuel taxes, and domestic aviation related charges

Plus the government has given an additional A$300 million package comprising $A198 million to support regional aviation and a $A100 directly to support regional airlines

Austria has given a 90% government guarantee for €300 million of loans for Austrian Airlines 

Later the Lufthansa-owned airline was forced to agree to environmental targets in order to access an additional €600 million in state aid

Brazil is postponing payments of air navigation and airport fees 

Burkina Faso flag carrier Air Burkina to receive state bailout of US$6 million, contained in a budget amendment bill for fiscal year 2020

China has reduced airport charges as well as providing subsidies for airlines that continue to fly to the country

Colombia gave significant tax relief for airline tickets, jet fuel and tourism to its package of relief measures

Croatia has suspended its proposed privatisation of Croatia Airlines with the government stating it would continue to support the carrier until a sale was possible

Egypt is making loans with a two-year grace period available to aviation sector firms

EUROCONTROL fees have been deferred until November

France has set out €700 million of tax aid to airline sector defer the payment of certain taxes due between March and December 2020 to after January 1 2021, for up to 24 months

Air France-KLM has secured a €7 billion state aid package from the French government

The total package reached $16.9 billion with the addition of further support for the aviation sector 

Finland the government has provisionally agreed to provide a state guarantee of up to €600 million to Finnair

Germany has given TUI a state aid bridging loan for €1.8 billion via KfW

Condor has received €550 million in assistance from the federal and Hessian state governments

Lufthansa has been approved for a €9 billion bailout package

Hong Kong – The Hong Kong Airport Authority, provided an initial "total" relief package valued at HK$1.6 billion (US$206 million) including waivers on airport and air navigation fees and charges, and rent reductions for aviation services providers

The government then gave another HK$2 billion in relief, including purchasing 500,000 tickets in advance from Hong Kong based carriers to inject liquidity into the airlines

The government has taken a $5billion equity stake in Cathay Pacific

Iceland contracted Icelandic Air to keep a number of flights to London, Stockholm and Boston, until May 5

New Zealand will provide a NZ$900 million (US$580 million) loan facility to Air New Zealand as well as an additional NZ$600 million relief package for the aviation sector

The Netherlands has given KLM €3.4 billion in state aid

Norway is giving a state loan-guarantee for its aviation industry totalling NKr6 billion (US$533 million), of which NKr3bn ($270m) is potentially for LCC Norwegian Air Shuttle

The Government is fully compensating airports for the loss of airport charges and has suspended the air passenger tax until October 13

Russia has given $107 million in aid to Aeroflot and extended tax payment deadlines for the whole aviation sector

Portugal has given €1.2 billion in support to TAP

Senegal announced US$128 million in relief for the tourism and air transport sectors

Seychelles has waived all landing and parking fees for April to December 2020

Singapore has given relief measures valued at S$112 million (US$82 million) including rebates on airport charges, assistance to ground handling agents, and rental rebates at Changi Airport.

State-backed investment fund Temasek  is underwriting Singapore Airlines  3 billion Singapore dollars ($3.72bn) in equity and up to 9.7 billion Singapore dollars ($6.8bn) capital raising*

The Solomon Islands' government is taking an equity stake in Solomon Airlines

Spain has opened a credit line of up to €400 million for the travel sector, via the state-owned Credit Corporation

Sweden and Denmark have 90% guaranteed a SEK 3.3 billion three-year revolving credit facility for SAS

Thailand was discussing giving flag carrier Thai Airways a $1.8 billion guaranteed loan but let the firm go insolvent instead

Tahiti is supporting airline Air Tahiti with US$77.0 million in subsidies in 2020

Turkey has offered unspecified support to Turkish Airlines as part of a $11.6billion COVID 19 stimulus package

United Kingdom has ruled that Wizz Air is eligible for its Covid Corporate Finance Facility

UK LCC EasyJet has tapped the CCFF for £600 million

Sources – Bird & Bird, Cowen, IMF, IATA, The UK Airports Operators Association, and Airline Economics research

*Technically this isn’t state aid, however, Temasek is a state backed investment fund and it owns 55% of Singapore Airlines