Middle East airlines need state aid to survive virus crisis

Dubai - Post-coronavirus era to see thinner line-up of carriers that will deprive regional passengers of choice they enjoyed in the past

 As coronavirus grounds airlines, plunging the industry into unprecedented crisis, Middle East carriers that have been in the red for years must urgently tap assistance from governments facing their own revenue slump.

Authorities across the region have taken draconian measures to curb the disease, closing airports and halting passenger flights, and bringing major hubs to a standstill.

The Arab Air Carriers' Organization (AACO) and the International Air Transport Association (Iata) have appealed for urgent financial aid from governments, warning that inaction will imperil the industry's future. "The airline industry faces its gravest crisis... for airlines, it's apocalypse now," Iata chief Alexandre de Juniac said this week.

The AACO, which represents some 30 Arab public and private carriers, has called for support packages including tax relief, waivers of a string of fees and charges, and help with new virus-related costs.

"AACO sees the above measures as very important for governments to adopt in order to avoid a scenario where airlines would not be able to provide the public with convenient services," it said in a statement.

It warned that without action, the post-coronavirus era will see a thinner line-up of carriers that will deprive regional passengers of the choice they enjoyed in the past.

The Iata, which represents 290 airlines worldwide, said that 2020 revenues of Middle Eastern carriers, which operate over 1,300 aircraft, are expected to drop by $19 billion, a 39 per cent decline over last year.

The impact on the region's air transport sector imperils at least 800,000 jobs and could result in the loss of tens of millions of passengers this year, it warned.

Other airlines have resorted to deep cost-cutting measures without delay, and cuts to the region's $100 billion worth of aircraft orders may be on the cards.

"If government support is not provided, carriers may be forced to cancel orders," Muhammad AlBakri, Iata vice-president for Africa and the Middle East, told AFP.

Dubai's Emirates, the largest carrier in the region and one of the world's biggest, slashed staff salaries by between 25 percent and 50 percent for three months, saying the measure was designed to avoid layoffs.

Emirates is among a few regional airlines which have been posting profits, but those profits have moderated in recent years amid an economic slowdown.

Many of the 19 state-owned Arab carriers have been posting losses, forcing governments to plug the gap.