Ho Ngoc Yen Phuong, deputy CEO of budget airline Vietjet, said the pandemic has cut the carrier’s revenues by 70 percent, forcing it to cut managers’ salaries by half and pay minimum salaries of VND8-10 million ($345-432) to other staff.
“The aviation industry will take until 2023 to recover, and the government’s support is need to help airlines overcome the difficult time and continue contributing to the state budget,” she said at a recent forum.
Noting that a bailout plan including refinancing and loan extensions was recently approved for the national flag carrier, Vietnam Airlines, Phuong said Vietjet requests a refinancing package of VND4 trillion at low interest rates for 3-5 years.
Vietjet will pay back the amount with interest in the 2023-2025 period, she added.
Phuong also proposed that all loan repayments of airlines are extended until the end of next year, and that they are allowed to access credit with a 3 percent reduction in interest rates.
Nguyen Khac Hai, deputy CEO of Bamboo Airways, also proposed the government provides a refinancing package at interest rates of 2-3 percent, along with reductions in fuel and flight management fees.
The airline has enough assets as collateral for such loans as well as feasible repayment plans, he said.
Economist Ngo Tri Long said that the cash flow of local airlines have been seriously drained, and a VND4 trillion refinancing package for each airline will not cause a major dent in the state’s coffers because carriers contribute over VND20 trillion in taxes and fees each year.
“With capital, the airlines will be able to repay debts and contribute more to state’s coffers. After Vietnam Airlines, the government needs to let other airlines access low-interest loans to ensure a fair competitive environment,” Long said.
Deputy Minister of Transport Le Anh Tuan said that the ministry would review the proposals and advise the government.
He said the ministry was finalizing a plan to resume more international flights by reviewing localities’ quarantine procedures and capacity to receive passengers.
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