Aviation revenues last year fell by over 61 percent from 2019, and the third Covid-19 wave in the first quarter of this year caused revenues to plunge 80 percent year-on-year, making it next to impossible for carriers to service their loans, according to a recent report by the Ministry of Planning and Investment.

National flag carrier Vietnam Airlines projected a loss of VND4.8 trillion in the first quarter and VND10 trillion in the first six months. It is now said to be on the verge of bankruptcy.

"The airline is facing legal cases due to high overdue debts and risks in balancing short-term loans."

Since commercial banks have not received the VND12 trillion ($523 million) support package from the government, they have not been able to grant loans to Vietnam Airlines.

Meanwhile, budget carrier Vietjet is short of VND10 trillion for its operational expenditures.

With experts and industry insiders estimating it would take at least until 2024 for the aviation industry to recover to pre-pandemic levels, the ministry has proposed that the government provides carriers with loans at four percent interest during the 2021-2023 period to help them survive.

Other reductions or scrapping of service fees at airports should be maintained until the end of this year, it added.

Meanwhile, a report by the Vietnam Tourism Association (VITA) says up to 90 percent of tourism companies, restaurants and hotels are in dire straits.

Most of these businesses have had to let their employees stay at home without pay, the report says.