Airlines worldwide need $200 billion (KSh20.8 trillion) capital injection for them to remain afloat in this COVID-19 pandemic, officials from International Air Transport Association (IATA) now say.
IATA reports that 75% of the airlines only have cash to cover three months of their fixed expenses. Airlines globally have recorded a reduction in business as a result of travel restrictions.
According to IATA Director General, Alexandre de Juniac, governments could do the following to help airlines:
- Offer financial support for carriers to compensate for reduced revenues
- Loans, loan guarantees and support for the corporate bond market
- Tax relief: Rebates and/or suspension of the same
Already, plane makers Boeing and Airbus are in talks with their respective governments regarding the state aid, with the former allegedly seeking $60 billion.
Locally, Kenya Airways already reported a $8 million loss after suspending flights on its Nairobi – Guangzhou route where there was an upsurge of the COVID-19 cases. Its subsidiary, Jambojet, suspended flights to Rwanda and Uganda yesterday.