Vietnamese private airlines like VietJet Air and Bamboo Airways have asked the government for a relief package to help them weather the COVID-19 crisis after national flag carrier Vietnam Airlines received the go-ahead to the plan. 

Private airlines like VietJet Air and Bamboo Airways are in dire need of
preferential loans to get through the COVID-19 crisis. (Photo: vneconomy.vn)

Ho Ngoc Yen Phuong, vice president and CFO of VietJet Air, said the firm had lost VND2,400 billion during the past three quarters of the year and its debts had amounted to VND10,000 billion.

Vietjet Air has achieved a growth rate of over 30% annually, but the COVID-19 pandemic caused its revenue to drop by 70%, Phuong told a seminar on November 26 to rescue the aviation industry.

She proposed that VietJet Air get access to commercial banks’ preferential loans over 3-5 years to get through the crisis and it pay debts and interests over 2023-2025.

Sharing Phuong’s view, Nguyen Khac Hai, deputy general director of Bamboo Airlines, said that private airlines are in dire need of mid- and long-term loans to surmount difficulties caused by the disease.

In addition, he proposed that the government consider reducing take-off, landing fees, as well as flight management and fuel costs until the end of 2021.

Such measures will help airlines tackle the crisis, recover and continue to contribute to the national budget, said Hai.

Private airlines grappling with huge losses have appealed for preferential loans from commercial banks after Vietnam Airlines was green-lighted to access preferential bank loans to resolve the crisis.

Pham Van Hao, deputy head of the Civil Aviation Administration of Vietnam, said his agency is considering reopening international flights to Vietnam in a controlled manner. He also warned that it would take the aviation market three years to fully recover.

However, according to Dr Ngo Tri Long, an economic expert, the government should lend preferential loans to airlines to help them recover and at the same time to ensure fair competition.

Deputy Minister of Transport Le Anh Tuan acknowledged the airlines’ proposals and his ministry would submit them to the government for consideration.