According to information compiled by the Vietnam Aviation Business Association (VABA), local airlines have suffered estimated losses of over VND18,000 billion from air transport activities, with revenues dropping by roughly VND100,000 billion over 2019.
The international flight market currently remains frozen, with the main flight activities of airlines being repatriation flights, along with the transport of experts and goods.
The opening two months of the year has witnessed international passenger transportation reach only 66,600, a massive decline of 98.8% over the same period from last year.
“The domestic aviation market has also witnessed a slowdown, with sharp increases in the number of passengers, while the cost increased sharply due to the assurance of pandemic prevention measures. Airlines’ sales during the lunar New Year festival (Tet) also decreased by between 70% to 80% on average over the same period last year,” stated VABA.
Furthermore, amid the narrowing of flight operations, commercial services, technical services, and catering services have been adversely affected, with the revenue of local airlines enduring a decline from March.
Moving forward, local airlines are anticipated to continue to experience a steep fall in revenue in comparison to 2019, with firms forecast to face loses of more than VND15,000 billion from air transport this year.
Judging from the current situation and forecast ahead for the rest of the year, the VABA has proposed a number of policies and solutions aimed at assisting aviation firms to overcome difficulties and challenges caused by COVID-19. These solutions will focus on expanding credit support schemes for airlines, promoting the application of the Government’s Resolution on supporting interest rates for firms, and allowing them to restructure their loans, reschedule debts arising in the 2020 to 2021 period, and not change debt groups until December 31.
The VABA has also proposed further reducing the environmental protection tax on aviation fuel to VND900 to VND1,000 per litre. This is in addition to extending the deadline for paying corporate income taxes, value added taxes, personal income taxes, foreign contractor taxes, and land rentals for all obligations arising until December 31.
Simultaneously, it also suggests extending the time limit for payment of import tax and value-added tax on imported equipment and materials used by the industry in order to ensure the compliance of periodic maintenance.
The association also underlined the need to swiftly resume international routes and accept foreign visitors to the nation when vaccinated, especially those from countries with the large number of passengers which have contained the pandemic. This includes countries such as, Australia, China, the Republic of Korea, and Japan.