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Amid a faltering recovery, aviation authority calls on further support for airlines

As the international flight market needs more time to recover from the negative impacts of the COVID-19 pandemic, the Civil Aviation Administration of Việt Nam (CAAV) has called for more Government support for airlines operating in the country.

Lao women's football teams arrive at Noi Bai International Airport on May 6 for the SEA Games. 

According to the CAAV, since frequency restrictions were lifted for domestic flights, Vietnamese airlines have re-operated nearly 60 domestic routes with about 700-800 flights daily.

After the country resumed international flights in the middle of February this year, flight routes from Việt Nam to more than 20 countries and territories were reopened including Japan, South Korea, China, Hong Kong (China), Taiwan (China), Singapore, Thailand, Cambodia, Malaysia, Philippines, Laos, Qatar, Turkey, United Arab Emirates (UAE), France, Germany, UK, Russia, Australia, and United States.

Its aviation markets are expected to continue reopening and the number of international flights departing from or arriving in Việt Nam would gradually increase.

The CAAV estimated that this year, airlines could serve 42-47 million passengers, an increase of 170-200 per cent compared to 2021 but a decrease of more than over 40 per cent compared to 2019.

In the domestic flight market alone, the number of passengers transported is estimated at 33-35 million, down six to ten per cent compared to 2019.

Although Việt Nam has been gradually controlling the COVID-19 pandemic, and socio-economic activities have returned to a new normal state, it takes more time for aviation businesses to recover losses and restore business operations.

Deputy Director of the CAAV Phạm Văn Hảo said that by the end of this year, the number of passengers using domestic flights would approach the number of 2019 - the time before the outbreak of COVID-19.

However, the international flight market alone needed more time to recover, Hảo said, adding that the international passenger transport volume this year was estimated at 72-80 per cent lower than that of 2019.

“As the proportion of revenue and profit of airlines mainly comes from the international transportation market, airlines will continue to face difficulties this year,” Hảo said.

In addition, the price of Jet A1 has continued to rise and the economic and political instability in the world caused fuel prices to spike, putting heavy pressure on the costs shouldered by airlines, he said.

At the end of March 2022, although crude oil prices showed signs of slowing down, the price of Jet A1 continued to increase. According to IATA statistical data, the price of Jet A1 in Asia on April 1, 2022 increased to $132.63 per barrel. On April 29, 2022, it continued to increase to $145.67 per barrel. The average price of Jet A1 in 2022 is forecasted to be $129.5 per barrel.

The CAAV official said that currently, the Government was still implementing solutions to help remove difficulties for businesses that are negatively affected by the COVID-19 pandemic, such as policies on tax and fee exemption and reduction, and policies on interest rate support for the 2022-23 period, in which the interest rate support is 2 per cent per year through commercial loans for businesses and co-operatives, and household businesses.

Together with support for businesses in general, specific support for aviation business is needed, according to the CAAV.

The CAAV proposed the Ministry of Transport continue to promulgate the policy exempting half of landing/take-off service prices for domestic flights from January 1, 2022 to the end of December 31, 2022 and allow specialised aviation services on the list of State-prescribed prices to be at a minimum of zero Vietnamese đồng from January 1, 2022 to the end of December 31, 2022.

According to the General Statistics Office, last month, the number of international visitors to Việt Nam reached 101,400, 2.4 times higher than that of the previous month and 5.2 times higher than the same period of last year.

In the first four months of this year, international visitors to the country reached nearly 192,400, an increase of 184.7 per cent over the same period last year.

Visitors arriving by plane accounted for 88.6 per cent of international visitors to the country.

Source: VNS

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