Lawmaker files P40-billion relief package for Philippines' air transport sector

RG Cruz, ABS-CBN News

Posted at May 18 2021 05:47 PM

Lawmaker files P40-billion relief package for Philippines' air transport sector 1
Planes remain grounded amid the start of the air travel ban for domestic flights to and from Metro Manila and other airports in Luzon under the enhanced community quarantine on March 20, 2020. Mark Demayo, ABS-CBN News/File

MANILA - A lawmaker on Tuesday filed a bill that seeks to provide a P40-billion relief package for the Philippine air transport sector as it reeled from the impact of COVID-19.

Under House Bill No. 9324 or the “Air Carriers Relief Act,” AAMBIS OWA Party-list Rep. Sharon Garin, chair of the House Committee on Economic Affairs, proposed providing relief for all domestic air carriers in the Philippines.

A domestic air carrier is a company duly organized and existing under Philippine laws.

Among proposed assistance are: 

  • Extension of the term of the air transport sector’s loans for 3 years and possibly another 2 years afterwards 
  • Interest free loans from the Development Bank of the Philippines with a maximum loanable amount of P2 billion 
  • Loan guarantees from the Philippine Guarantee Corporation
  • Government to pay for non-tax and non-duty fees and charges, including navigational and airport charges of domestic carriers charged by airports 
  • Conversion of passenger refunds into travel vouchers for future travel
  • Temporary relief from imposition of excise taxes on fuel 
  • Coverage of COVID-19 testing costs

The package will cost P40 billion in all, with P10 billion allocated for interest-free loans from the Development Bank of the Philippines; P10 billion for the Philippine Guarantee Corporation Special Guarantee Fund; P10 billion for regulatory fees; and another P10 billion for rapid COVID testing.

“Due to COVID-19 Pandemic, the members of the Philippine air transport sector are facing an existential threat," Garin said in the bill's explanatory note.

The Air Carriers Association of the Philippines (ACAP) earlier said local airlines currently operate just 10 to 12 percent of their flights from pre-pandemic levels.

ACAP vice-chairperson and executive director Roberto Lim said the restrictions imposed from March 29 to April 12 to arrest the continuing surge in COVID-19 cases disrupted the recovery momentum of the air transport segment.

Local airlines are estimated to have "easily" lost about P60 billion since the pandemic started until December 2020, he said.

Due to the pandemic, airlines have had to implement some tough cost-cutting measures, such as retrenchment, as well as other efforts to mitigate COVID-19's impact to stay afloat. 

Despite the slump, carriers across the globe, including the Philippine Airlines, have been testing the use of a global digital pass to consolidate travel requirements for ease in transport when flights return to normal.

Even with few flights, domestic carriers in the Philippines participate in the government's vaccination drive by transporting vaccines across the country. 

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