Let’s start with Malaysia, a tropically cool paradise smack within a miniscule area called the Southeast Asia. Within a regionally attraction that is distinctly equal of beauty is the Andaman archipelago in the northwest and Indonesia’s popular reefs in the south; with a bustling, healthy micro-economy — Malaysia’s aviation industry is financially challenged, in a creative way, indeed a battled being felt truly also in the tourism industry.
According to Nikkei Asia today, AirAsia Group Bhd has secured a $242 mil (RM1 bil) loan from Malaysia’s government as a lifeline to its challenges facing the coronavirus pandemic.
The loan will be 80 percent guaranteed by Malaysia’s very own finance ministry through a group of local banks under the government’s state-owned financial guarantor, the Danajamin Prihatin Guarantee Scheme (DPGS), according to Nikkei Asia, quoting sources from the ministry and airline. The stimulus package of RM50 bil was recently introduced by Malaysia’s Prime Minister Tan Sri Muhyiddin Yassin to contain the crisis caused by the pandemic.
As AirAsia embarks on another round of job cuts come November 2020, it has already downsized its workforce by 10 percent and further plans to reduce its fleet of aircraft. Reuters recently quoted CEO Tony Fernandes is in discussion with Airbus to reduce orders pending for A320 and A321 aircrafts, and lessen the AirAsia fleet to 180 planes by the end of 2021.
Meanwhile, Malaysia’s national flag carrier, Malaysia Airlines and its fate has yet to be determined. It received a $1.5 bil injection of funds in 2014 for a five-year plan to financially turnaround after its twin air incident. Owned by state wealth fund — Khazanah Nasional — it has begun negotiations with lessors of its aircraft.
Next door, Thailand’s flagship carrier Thai Airways was approved by its consumer court to go ahead with debt restructuring; facing a total of $10.6 bil in liabilities as of June 2020 according to Bangkok Post. Furthering elaborating that Thailand’s Finance Ministry owns about 48 percent of Thai Airways with tourism contributed around 11 percent to Thailand’s GDP last year.
After launching new flights to Shenzhen, China and Bali, Indonesia last year, Vietnam Airlines,like any other in the region, reported in Q1, its increase of domestic services. And by June, Qantas has confirmed its exit as a minority stake in Jetstar Pacific, which then saw the renaming back to its original brand name, Pacific Airlines. Last month, it resumes its international route from Seoul to Hanoi.
Covid Lifeline: The aviation story continues….
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