EgyptAir Holding Company will receive EGP 2 billion as a supportive loan against the repercussions of the coronavirus, Minister of Finance Mohamed Maait announced on Saturday.
In a statement, Maait said the public purse will shoulder the cost of the loan until the company is able to attain 80 percent of its 2019 operation rates.
The move is based on President Abdel-Fattah El-Sisi's directives to support the civil aviation sector against the COVID-19 implications that disrupted global air traffic disruption and significantly affected EgyptAir Holding Company and its affiliates, according to the statement.
Maait added that the pandemic resulted in the loss of revenue for the company that still bore fixed expenditures, such ad the employees’ salaries. He pointed out that the finance ministry held two meetings with the minister of civil aviation and the company’s representatives to discuss the essential needs of the company amid the current crisis.
“This loan is part of the supportive procedures that the government has adopted to back the affected economic, social and service sectors because of the coronavirus outbreak in order to set the balance between keeping the people’s health safe, pursuing the production wheel, retaining the workforce, providing the domestic market needs, sustaining public services provided for citizens, and alleviating the harsh impacts of the crisis on the national economy,” said Maait.
He added that the government is striving to keep the gains of the economic reform programme, including ensuring the fiscal policy stability and maintaining the state’s safe economic trajectory.
Maait noted that new Law 24/2020 came into force at the end of March to provide supportive facilities for the hard-hit sectors.
In April, the International Air Transport Association said that Egypt’s airline sector’s revenues were expected to drop by $1.6 billion, with 9.5 million fewer passengers in 2020 as a result of the COVID-19 crisis.
The sector contributes to the Egyptian national economy with $2.4 billion and has created 205,560 jobs.
The pandemic affected global tourism, which is seeing declines in the range of 60 percent to 80 percent in international tourist arrivals in 2020. Losses in the sector depend on the speed to contain the pandemic and the duration of travel restrictions and shutdown of borders, according to the Committee for the Coordination of Statistical Activities.