Russia offers virus-hit airlines $316-million subsidy

Agence France-Presse
Russia offers virus-hit airlines $316-million subsidy
The Russian government says airlines can use the emergency funds for salaries and the cost of leasing planes, among others

MOSCOW, Russia – The Russian government on Thursday, May 14, announced an emergency handout of 23.4 billion rubles ($316 million) for airlines struggling because of the coronavirus pandemic.

President Vladimir Putin had already disclosed the amount of the planned handout from Russia’s reserve fund but the publication of a government decree allows airlines to apply for funding.

Russia’s civil aviation agency said flagship airline Aeroflot had already applied for the funding.

The government said Russian airlines can spend the money to cover out-goings including salaries and the cost of leasing planes.

“The state subsidies will allow airlines to survive a period of restrictions linked to the complex epidemiological situation and help preserve civil aviation’s workforce capacity,” the government said on its website.

Russia began reducing international flights from late January, first to China and then to Europe. 

Putin said at a meeting with companies on Wednesday, May 13, that airlines had seen “perhaps the most serious slump of any form of transport.”

The number of international flights has fallen by 90% and domestic flights by 88%, Putin said.

Out of Russia’s airlines, Aeroflot saw the biggest drop in passenger numbers in April, down more than 95% at around 148,000, the civil aviation agency said Tuesday, May 12.

All international flights were grounded in late March, although there have since been a few flights ferrying stranded Russians in and foreigners out.

Domestic flights have continued but some airlines, such as lowcost Pobeda, have opted to suspend all services. The airline on Wednesday announced it will restart flights from June 1.

“Airlines are racking up losses very quickly and so are other players in the market such as airports,” aviation analyst Oleg Panteleyev told Agence France-Presse.

“All this could put the sector beyond the point of viability.”

Russian Prime Minister Mikhail Mishustin said in early April that airlines would receive 1.5 billion rubles ($20 million) in compensation for evacuating Russians stranded abroad. –

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